InsurTech
What is InsurTech?
The term ‘InsurTech’ currently has no legal definition. In general, the term refers to all new technologies used in the area of insurance; however, there is no consistency among the service providers
Across all development stages of insurance products, there are numerous ways for technologies to be used for example, in tailor-made insurance products, websites comparing prices of similar products of several insurance companies, telematics, etc.
The use of technologies in insurance is constantly developing and technologies have lately been applied mainly in insurance product distribution and management, i.e. they are mainly used for insurance intermediation. The technologies include applications searching for insurance products according to parameters predefined by customers, Internet portals comparing similar insurance products of various insurance companies, as well as applications used in underwriting which set the price of insurance directly for individual customers, and also including insurance contract intermediation via the Internet without personal meetings with customers.
In all the above-mentioned examples of technology utilisation, the firm which has developed the software for insurance contracts underwriting is not responsible for the insurance contract or intermediation of insurance, and this firm is neither regulated nor licensed or supervised by Národná banka Slovenska, except if this firm uses the systems itself to distribute insurance products, or if it is a financial institution authorised to provide insurance or reinsurance services. Moreover, Národná banka Slovenska does not supervise firms providing telematics, i.e. equipment for processing of data used by insurance companies to set the insurance price in compulsory contractual motor vehicle third party liability insurance and motor vehicle insurance.
Whenever insurance contracts are underwritten, including their underwriting using any technologies and electronic applications, it is necessary that the intermediaries arranging insurance contracts on behalf of insurance companies are registered in the Register of financial agents and financial advisers of Národná banka Slovenska, and that the insurance company with which a customer concludes a contract is allowed to provide services in Slovakia based on a license or through a branch from another EU Member State, or under the freedom to provide services from another Member State of the European Union.
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I. Legislation
Currently, there is no European or Slovak legal regulation defining InsurTech or laying down rules on the application and use of technologies in the insurance sector. However, entities operating in the financial market are required to comply with legislation relevant to InsurTech. Such legislative provisions must be applied if software applications are used in concluding insurance contracts both at personal meetings with customers and in insurance via the Internet or telephone.
Slovak legislation regulating customer protection does not make a distinction between providers of insurance licensed by Národná banka Slovenska and those offering services from other EU Member States. All entities providing insurance must comply with the legislation on insurance and insurance intermediation in force in Slovakia.