Insurance laws Andorra
In Andorra, insurance is regulated by the Andorran Financial Authority (AFA), a public institution responsible for the supervision and control of the financial sector. The legal framework for insurance is primarily based on Law 12/2017 on insurance and reinsurance, which aims to align Andorran regulations with European Union standards, particularly the Solvency II regime.
Key Aspects of Andorran Insurance Law
Regulatory Body: The Andorran Financial Authority (AFA) handles the licensing, oversight, and enforcement of regulations for insurance companies and intermediaries operating in the country.
Andorran Bureau: The Andorran Bureau of Motor Insurance Entities is a non-profit organization that represents all motor insurance companies in Andorra. It functions as part of the international Green Card System, which facilitates the handling of motor insurance claims for accidents involving vehicles from different countries.
Contractual Principles: Insurance contracts must be in writing. The law requires insurers to provide clear and detailed information to policyholders before they sign a contract.
Mandatory Insurance in Andorra
Several types of insurance are compulsory in Andorra:
Motor Third-Party Liability Insurance: This is a legal requirement for all motor vehicles registered in Andorra. It covers damage or injury caused to other people or their property in a road accident. Drivers from other countries entering Andorra are also required to have a policy that is recognized in the Principality.
Health Insurance: Andorra has a public healthcare system managed by the Caja Andorrana de Seguridad Social (CASS), which is based on a co-payment model. All residents must be affiliated with CASS. For those applying for a passive residency visa, it is a legal requirement to have medical, disability, and retirement insurance that provides coverage in Andorra, in addition to contributing to CASS.
Home Insurance: Both owners and tenants of properties are required to have home insurance. For tenants, this typically covers civil liability for damage like fire or water leaks. For owners, it's mandatory to insure the building itself, often with a second policy to cover content and supplementary civil liability.
Professional Liability Insurance: Specific professions may be required to carry professional liability insurance to cover potential harm caused to clients due to professional negligence.
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