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RESOLUTION OF THE NATIONAL COMMISSION ON THE FINANCIAL MARKET OF THE REPUBLIC OF MOLDOVA

of June 24, 2019 No. 25/2

About procedure for representation, coordination and application of aktuarialny calculation of insurance premiums for compulsory third party car insurance

(as amended on 23-06-2020)

Based on provisions * Art. 11 of the h. (3) the Law on obligatory civil liability insurance for the damage caused by vehicles No. 414/2006 (it is repeatedly published in the Official monitor of the Republic of Moldova, 2016, No. 44-48, by the Art. 85), and according to the Resolution NKFR No. 57/13 of 28.12.2018 (The official monitor of the Republic of Moldova, 2019, No. 76-85, the Art. 416), the National commission on the DECIDES: financial market

1. The insurers authorized to perform activities for compulsory third party car insurance annually, till March 15 of the current year, represent to supervision body technical calculation basis for statistical data (avoiding duplication of the renewed/changed agreements), according to appendix to Single methodology of calculation of the basic insurance premium and corrective coefficients on internal and external compulsory third party car insurance (further - Methodology) approved by the Resolution NKFR No. 57/13 from 28.12.2018, in the following procedure:

1) the technical base of calculations is represented electronically, initially over the last 5 years (separately for each consecutive year), and then for previous year, confirmed officially by the letter certified by the autographic / strengthened qualified digital signature of authorized executive body of the insurer;

2) the insurers performing activities less than 5 years represent the technical calculation basis relating to statistical data, for the period implementation of the activities.

2. The supervision body, at least once a year, based on the generalized and conditionally offset statistical data at the market level provided according to Item 1, calculates based on Methodology and approves approximate award on internal compulsory third party car insurance according to appendix No. 1 and approximate award on external compulsory third party car insurance according to appendix No. 2.

3. Insurers annually, till May 1 of the current year, represent to supervision body, on papers and electronically, the calculation of basic insurance premium and the corrective coefficients on risk factors relating to internal compulsory third party car insurance determined according to the technical calculation basis of statistical data provided to supervision body according to Item 1, accompanied with the explanatory note, confirmed with the autographic / strengthened qualified digital signature of the actuary of the insurer.

In case of identification of discrepancies of the calculation provided on paper and its electronic option the calculation option on paper will have advantage.

4. The explanatory note specified 3, will contain in Item at least the following:

1) confirmation of correctness and completeness of the data which formed the basis for calculation of basic insurance premium and corrective coefficients (reserves, compensations and policies);

2) the used hypotheses and their reasons;

3) the used aktuarialny methods;

4) procedure for determination of basic insurance premium and corrective coefficients and, respectively, the analysis on each component and on each segment of risk from which adequacy shall proceed:

a) risk award;

b) shares of loading and profit margin;

c) corrective coefficients.

5. Insurers bear responsibility for correctness, reliability and relevance of information provided to both supervision body, and actuaries and also shall notify supervision body on the mistakes revealed in earlier provided data for all accounting periods in which they were allowed or on which they exerted impact.

6. Till 45 working days from the date of receipt of complete set of documents according to Item 3 the supervision body the decision claims or rejects basic insurance premium and corrective coefficients on risk factors, belonging to internal compulsory third party car insurance. In case of the motivated decision on variation the supervision body returns the set of documents provided by the insurer for conducting additional investigations, in writing informing the insurer on the decision. In this case the insurer applies approximate award before pronouncement of the following decision by supervision body.

7. If during consideration of the complete set of documents provided according to Items 3 and 4, there were changes, the insurer shall report about it to supervision body and provide documents/information corrected in this sense.

8. In case, stipulated in Item 7, and also in the conditions of need of request of the additional information or for remedial action, revealed by supervision body, the term established in Item 6, can be extended for the period to 20 working days with the written notice of the insurer.

9. Insurers establish basic insurance premiums and corrective coefficients on internal compulsory third party car insurance for a period of one year.

10. When the insurer acquires/recovers the right to implementation of policies of internal and external compulsory insurance of AGO or states the basis for change of basic insurance premium, it notifies supervision body on intention to establish or change basic insurance premiums at least in 30 working days prior to that period when they can be applied.

11. In case, stipulated in Item 10, the explanatory note constituted and certified by the autographic / strengthened qualified digital signature of the actuary of the insurer according to Item 4, with the detailed description of the performed procedures and the received results is attached to the notification.

12. Insurers who have no the sufficient statistical information necessary for aktuarialny calculation according to Methodology will apply the approximate award established by supervision body. As sufficient statistical information on internal compulsory third party car insurance are considered:

1) ownership of completeness of data for corrective coefficients; and/or

2) cumulative accomplishment of the following conditions:

a) minimum period of activities at least 4 consecutive years;

b) minimum annual quantity of 300 cases on damage.

13. Insurers who will not provide for the end of the last accounting year the standard rate of sufficiency of solvency at the level of 120% will apply the size of approximate award or the size of insurance premium calculated by these insurers according to the decision of supervision body.

14. Insurers who will not provide documents / technical base according to this resolution or will not meet the deadline of their provision, will be made responsible according to the legislation and will apply approximate award during the established period, but no more than one calendar year, based on the decision of supervision body.

15. During July 1, 2019 - on December 31, 2020 insurers will apply the approximate award on internal car responsibility insurance calculated by supervision body.

16. The basic insurance premium and corrective coefficients on internal car responsibility insurance calculated by insurers according to Methodology become effective annually since January 1, 2021.

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