Romania’s Parliament could vote a law which offers the Financial Supervisory Authority the power to take over and even sell an insurer in case of need, according to sources cited by local Capital.ro.

The law on the resolution and the recovery of insurance companies was discussed this week in the Budget and Finance Committee and the Economy Policy Committee within the Chamber of Deputies.

The new law comes after the supervisory authority decided at the end of August that the Romanian insurer Astra Asigurari had to go bankrupt, as the company had failed to attract new capital worth some EUR 95 million for its financial recovery plan. The law will grant the Financial Supervisory Authority more powers to intervene if an insurer has financial problems.

The banking system has an institution which can take over banks in distress in order to sell them piece by piece. However, creating such an entity in the insurance market would be a European premiere.

editor@romania-insider.com