Bulgaria: Bonus-Malus system one step closer to implementation

Ernst & Young, the Bulgarian Financial Supervision Commission's consultant on the bonus-malus system introduction for the MTPL insurance has submitted its final report, presenting no less than 11 possible scenarios for the system's design.

The report also mentions a large number of factors to be taken into account when building the Bonus-Malus system. All scenarios are based on data calculations for the Bulgarian market and reflect its specificity. A matter of judgment, if applicable, is which of the proposed bonus-malus scenarios is to be selected.

"Due to the very large number of options proposed, the Financial Supervision Commission (FSC) believes that it is currently not possible to proceed to a public discussion of a draft legal act," the market authority has stated. Thus, the Ernst & Young report was sent to the two state bodies which are part of decisional process: the Ministry of Transport, Information Technology and Communications and the Ministry of Interior.

According to the FSC statement, it will most probably take at least one month for each of the two agencies to hold their consultations and to indicate the most appropriate option in their opinion. After the two ministries together with the FSC express their preferences, a draft ordinance will be elaborated and submitted to public deliberation.

The regulation that will introduce the bonus-malus system in Bulgaria will be adopted jointly by the FSC, the Minister of Transport and the Ministry of Interior.

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