Following the application of the Conduct of Business Rulebook to the insurance sector on the 1st October 2018, there was a lacuna in terms of the rules which European insurance undertakings are required to observe when carrying on cross-border business in Malta on a freedom of services basis.
To address this lacuna, on the 16th April 2019, MFSA issued amendments to Chapter 9 of the Insurance Rules on Freedom of Establishment and Freedom to provide Services by a European Insurance Undertaking and a European Reinsurance Undertaking. These amendments identify the rules (also referred to as the general good provisions) in the Conduct of Business Rulebook which apply to European insurance undertakings carrying on cross-border business in Malta on a freedom of services basis or through freedom of establishment.
This is a welcome development in view that:
1. It provides European insurance undertakings with the required clarity and certainty needed to establish the applicable regulatory parameters within which such undertakings should undertake their cross-border activity in Malta, thus mitigating the risk of a compliance breach;
2. It safeguards Maltese policyholders’ interest in relation to aspects concerning information disclosures, selling processes and sales practices.
The Note for Information can be accessed by Clicking Here.