Insurance laws Iceland
Iceland's insurance sector is governed by a robust legal framework designed to ensure financial stability, consumer protection, and regulatory compliance.
📜 Key Legislation
Act No. 100/2016 on Insurance Activities
This foundational legislation regulates all insurance operations in Iceland, including licensing, solvency requirements, and supervisory practices. It mandates that only entities with the requisite operating licenses, granted by the Central Bank of Iceland, are authorized to engage in insurance activities.
Solvency Regulations
Insurers must maintain adequate capital reserves to cover potential liabilities. The Financial Supervisory Authority (FME) enforces these requirements, ensuring that insurers can withstand financial stresses and protect policyholders' interests.
Act No. 140/2018 on Measures Against Money Laundering and Terrorist Financing
This act imposes obligations on insurance companies to implement measures preventing money laundering and terrorist financing, aligning with international standards.
🏛️ Regulatory Authority
The Financial Supervisory Authority (FME) is the primary regulatory body overseeing the insurance sector in Icelan. It is responsible fo:
Granting operating licenses to insurance companie.
Monitoring solvency and financial stabilit.
Ensuring compliance with applicable laws and regulation.
Protecting policyholders' interest.
🚗 Mandatory Vehicle Insuranc
In Iceland, all registered vehicles must hae:
*Third-Party Liability Insurance: Covers damages your vehicle may cause to others, including personal injuries and property damae.
*Driver and Owner Accident Insurance: Provides compensation for personal injuries sustained by the driver or the owner if they are a passenger in their own vehice.
Optional additional coverages include windshield insurance and comprehensive collision insurane.
💼 Market Overviw
Iceland's insurance market comprises various companies offering life and non-life insurance produt. The FME oversees these entities, ensuring they adhere to regulatory standards and maintain financial heath.
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