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Insurance & Reinsurance

Finland

A new Insurance Companies Act has recently taken effect, replacing the 1979 act. The purpose of the new act is to clarify and modernize insurance company legislation, and certain restrictions and formalities in the previous version have been deleted or simplified. It also brings insurance legislation into line with the general Companies Act.

Car accidents involving elks occur only in Scandinavia and North America. However, a recent decision by the Finnish Supreme Court in such a case is significant as it relates to the assessment of the insured's intentions to prevent loss. The relevant insurance policy covered only damage caused by physical collision with an elk, and not damage caused by the driver's efforts to avoid the elk.

The Finnish Supreme Court has handed down judgment in a complex case relating to the right of direct action against a liability underwriter and the validity of arbitration clauses against the party pursuing the direct action. The Norwegian underwriter argued that the Average Adjuster of Finland had no jurisdiction in the case pursuant to the rules of the protection and indemnity club.

In September 2005 Parliament issued the Law on Insurance Agents and Brokers to deal with the substantial changes made by EU Directive 2002/92/EC on insurance agencies to national law. The directive was designed to harmonize member states' national rules in order to remove the obstacles to insurance/reinsurance agency business on the internal market.

A case currently pending before the Finnish courts demonstrates how a third-party claim under a liability insurance contract, which appears at first glance to be quite simple, can actually be extremely complex and demanding, requiring careful consideration.

Although Finland is an attractive market for foreign insurance companies, entry into the marketplace may be problematic. The complexity of the regulations, the duty of disclosure and differences in terminology all contribute to this. To add to the confusion, the supervisory authority does not issue advance rulings on contractual terms.

Shipping & Transport

Finland

In 2003, in response to suspicions that some ships did not satisfy the technical requirements for their ice class, the Finnish Maritime Administration not only issued new ice class certificates, but also ordered owners of vessels whose ice class was reduced to pay retroactively any fairway dues that had been avoided as a result. The move caused widespread confusion, which is still being resolved.