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GERB Proposes Amendments to Insurance Code

At a parliament briefing on Tuesday, GERB announced a proposal for changes in the Insurance Code concerning compensations to the relatives of victims of road accidents. The legislative initiative was unveiled after the GERB executive committee discussed ongoing tensions and protests in Bulgaria over controversial new insurance rules, among other things. 
GERB propose that compensations for death of close relatives (spouse, children and parents) due to a road traffic accident be unlimited, and compensations for the wider circle of relatives be up to 5,000 leva. The claim procedure will remain the same, with relatives providing a proof of non-pecuniary damage on a scale of one to ten, said the head of the parliamentary budget committee, Menda Stoyanova.
By decision of the Supreme Cassation Court (SCC) the range of persons eligible for compensation for death of a close one caused in a road traffic accident was extended from parents, spouses and children of the victim to the victim's siblings, grandparents, grandchildren and other persons who can prove an emotional bond with the victim. 
Stoyanova noted that from August 2018, when the court decision was made, to November 1, there have been 300 claims by 850 people seeking compensations and the average amount of the claim was 100,000 leva.
She said claims are expected to increase to an additional 100,000,000 leva because of the expanded range of persons eligible for compensation.
"If this cap of 5,000 leva for the expanded circle of relatives is not implemented and the current situation remains, this will result in additional costs for insurance companies, forcing them to raise the liability insurance," Stoyanova said. 
In her words, a liability insurance of 1,000 leva is fake news as estimates have never shown such a possibility.
Stoyanova noted that after the decision of the SCC lawyers have been tracing down distant relatives on already closed cases, offering them to claim compensations. She also said that while one cannot put a price tag on a person's life, there must be a limit to the demands of this extended circle of rightful claimants. 
Stoyanova said the Finance Minister and herself have asked to meet with President Radev to acquaint him with all details in the hope to gain his support.
The Union for Private Economic Enterprise (UPEE) told BTA on Tuesday that it is supportive of creating a methodology for assessing the damages and losses that Bulgarian business and households endure as a result of road traffic accidents. Furthermore, they are supportive of the cap on compensations as "an interim measure for stabilizing the sector until the methodology is introduced". 
The UPEE believe the measures proposed by GERB in the bill aim solely to protect policy holders in situations such as the bankruptcy of the "Olympic" insurance company. "This is why, as a nationally responsible and representative employers' organization, we support the proposal and insist on immediately taking measures in order to prevent the upcoming crisis," the UPEE said.


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