OPINION ON THE DRAFT LAW AMENDING THE INSURANCE CODE / 2024

TO
THE 51st NATIONAL ASSEMBLY

WITH A COPY TO:
Committee on Economic Policy and Innovation (Lead)

Committee on European Affairs and Oversight of the European Funds

Committee on Internal Security and Public Order

Committee on Transport and Communications

Committee on Budget and Finance

OPINION

FROM

The "BULGARIAN ENTREPRENEURIAL ASSOCIATION"S

Draft Law Amending and Supplementing the Insurance Code, 51-402-01-12/03.12.2024

DEAR MEMBERS OF PARLIAMENT,

I hereby submit for your attention the opinion of the "Bulgarian Entrepreneurial Association" on the Draft Law Amending and Supplementing the Insurance Code, 51-402-01-12/03.12.2024.

First, we consider that the proposed amendments to the Insurance Code in Article 344a(1)(1), (2), and (4) of the IC, which impose the mandatory use of a qualified electronic signature (QES) for the signing of insurance contracts, significantly hinder access to insurance services. Furthermore, the matter of the methods for the electronic signing of documents, including contracts, is already regulated in the Law on Electronic Document and Electronic Trust Services, which governs the types of signatures and their legal force, which is why the proposals are also unnecessary. On the one hand, this would require users of insurance services to obtain a qualified electronic signature from trust service providers, while also requiring them to pay the fees associated with obtaining such a signature. The purpose of the legislation, however, should be both to protect consumers and to facilitate their access to services, including insurance services. On the other hand, the proposed change restricts the possibility of using a simple and an advanced electronic signature, even though the Law on Electronic Document and Electronic Trust Services permits these forms of signing contracts. Pursuant to Article 13(4) of the LEDETS, paragraph 4: "The legal force of the electronic signature and of the advanced electronic signature is equivalent to that of a handwritten signature where this has been agreed between the parties." This means that the parties to an insurance contract have the right to agree to sign the insurance contract with an electronic signature or an advanced electronic signature, in which case these will have the force of a handwritten signature. Legal restrictions should not be imposed on the type of electronic signature with which contracts are to be signed, nor should the State intervene in this way in private-law relationships.

In view of the foregoing, we propose that the requirement to sign insurance contracts solely with a QES be dropped, and that the use of all three types of electronic signature recognised by the LEDETS — including the simple and the advanced electronic signature — be allowed. The parties may, at their own discretion, also agree on the possibility of signing insurance contracts with an electronic or an advanced electronic signature, and will confer on it the force of a handwritten signature, as contractual relations in the private-law sphere have developed to date; and signing with a QES is always equivalent to signing with a handwritten signature, which is why there is no need to regulate expressly in the Insurance Code as well how insurance contracts are to be signed electronically.

Next, the proposed provision of Article 344a(1) should apply only to Life Insurance products — Annex No. 1, Section I of the Insurance Code — and not to products in the Non-Life Insurance class under Annex No. 1, Section II of the Insurance Code, which is why we propose that this be expressly provided for in Article 344a(1) of the draft law. Our reasoning also overlaps with the considerations set out above, namely: in the proposed wording, Article 344a(1) does not draw a distinction between the insurance policies under Annex No. 1, Section I (Life Insurance) and Section II (Non-Life Insurance) of the Insurance Code. If the proposal is adopted, every insurance policy — regardless of whether it relates to life insurance or non-life insurance — would require the parties to hold a qualified electronic signature. Such an approach could create difficulties for customers wishing to conclude insurance contracts remotely, who for this type of insurance are predominantly natural persons, as they would be forced to obtain qualified electronic signatures. Therefore, and in the event that our proposal above is not adopted, we propose that, at least in Article 344a(1), the requirement for a qualified electronic signature be limited only to the products under Annex No. 1, Section I (Life Insurance) and not apply to the insurance products in the "Non-Life Insurance" class under Annex No. 1, Section II of the Insurance Code.

We hope that the proposals and comments made in this opinion will be taken into account in the adoption of the law.

Respectfully:
Dobromir Ivanov