{"id":104392,"date":"2025-04-23T14:21:54","date_gmt":"2025-04-23T14:21:54","guid":{"rendered":"https:\/\/my.legal500.com\/guides\/?post_type=comparative_guide&#038;p=104392"},"modified":"2025-08-20T15:38:15","modified_gmt":"2025-08-20T15:38:15","slug":"czech-republic-insurance-reinsurance","status":"publish","type":"comparative_guide","link":"https:\/\/my.legal500.com\/guides\/chapter\/czech-republic-insurance-reinsurance\/","title":{"rendered":"Czech Republic: Insurance &amp; Reinsurance"},"content":{"rendered":"","protected":false},"template":"","class_list":["post-104392","comparative_guide","type-comparative_guide","status-publish","hentry","guides-insurance-reinsurance","jurisdictions-czech-republic"],"acf":[],"appp":{"post_list":{"below_title":"<div class=\"guide-author-details\"><span class=\"guide-author\">J\u0160K advok\u00e1tn\u00ed kancel\u00e1\u0159<\/span><span class=\"guide-author-logo\"><img src=\"https:\/\/my.legal500.com\/guides\/wp-content\/uploads\/sites\/1\/2023\/04\/JSK.jpg\"\/><\/span><\/div>"},"post_detail":{"above_title":"<div class=\"guide-author-details\"><span class=\"guide-author\">J\u0160K advok\u00e1tn\u00ed kancel\u00e1\u0159<\/span><span class=\"guide-author-logo\"><img src=\"https:\/\/my.legal500.com\/guides\/wp-content\/uploads\/sites\/1\/2023\/04\/JSK.jpg\"\/><\/span><\/div>","below_title":"<span class=\"guide-intro\">This country specific Q&amp;A provides an overview of Insurance &amp; Reinsurance laws and regulations applicable in Czech Republic<\/span><div class=\"guide-content\"><div class=\"filter\">\r\n\r\n\t\t\t\t<input type=\"text\" placeholder=\"Search questions and answers...\" class=\"filter-container__search-field\">\r\n\t\t\t<\/div>\r\n\r\n\t\t\t\r\n\r\n\r\n\t\t\t<ol class=\"custom-counter\">\r\n\r\n\t\t\t\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">How is the writing of insurance contracts regulated in your jurisdiction?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>The writing of insurance contracts is regulated by the Insurance Act, the Act on Distribution of Insurance and Reinsurance (<strong><em>IRDA<\/em><\/strong>) and the relevant part of the Civil Code. The supervisor of the Czech insurance market is the Czech National Bank (<strong><em>CNB<\/em><\/strong>).<\/p>\n<p>The Civil Code requires that contracts concluded for one year and over be in writing and stipulates mandatory elements that the contract must include. These include (i) the contract number, (ii) the identification of the policyholder and insurer, (iii) the identification of the beneficiary or the means of identification, (iv) the insured event and the insurance peril, (v) the amount of the premium, its due date and whether it is a current or lump-sum premium, (vi) the period of insurance, and (vii) stipulations derogating from the insurance conditions, where applicable.<\/p>\n<p>Pursuant to the Civil Code, an insurer is also obliged to provide the policyholder with the insurance policy, which is a separate document and serves as confirmation that the contract was concluded.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Are types of insurers regulated differently (i.e. life companies, reinsurers?)<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>All types of insurers are regulated by the same laws and regulations; however, the law imposes different requirements on each insurer depending on the type of insurance it provides (e.g. different requirements are set out for life insurers compared to non-life insurers). The Czech legislator has therefore adopted an approach similar to that of the Solvency II Directive.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Are insurance brokers and other types of market intermediary subject to regulation?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Yes, there are currently three basic types of intermediaries: (i) independent intermediaries; (ii) tied agents; and (iii) ancillary intermediaries, all subject to insurance regulation. All insurance intermediaries are registered in the public register available on the website of the CNB.<\/p>\n<p>Besides the basic types of intermediaries, Czech law also recognises (i) a de\u00a0minimis intermediary that is exempted from the regulation, except for certain basic regulatory rules, and (ii) policyholders who offer participation in group insurance consistently for a fee. As a result of an amendment to the IRDA that passed in 2024, while the group structure policies are still permissible, these policyholders are now also considered intermediaries, making them subject to the IRDA obligations applicable to standard intermediaries, including the obligation to register with the CNB.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Is authorisation or a licence required and if so how long does it take on average to obtain such  permission? What are the key criteria for authorisation?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Yes, a licence is required for all (re)insurers and intermediaries, except for de\u00a0minimis intermediaries (please see above).<\/p>\n<p>The length of the licensing process varies and depends mainly on the size of the undertaking and the number of documents submitted. The CNB can also request additional documents and ask questions about the submitted documents, which prolongs the process. In our experience, the process takes at least one year for an insurer and about three months for an intermediary.<\/p>\n<p>For an insurer, the CNB grants the licence in accordance with the Insurance Act, which also sets out the criteria that the insurer must meet to obtain the licence. One of the most demanding is compliance with an adequate capital requirement. The rules for an adequate capital requirement are set out in the Insurance Act (but are based on the EU&#8217;s Solvency II Directive). However, if an entity wishing to provide insurance services is registered elsewhere in the EEA, it may distribute insurance in the Czech Republic based on the freedom of services or freedom of establishment principle, which requires only notification towards the CNB without the obligation to obtain a licence in the Czech Republic.<\/p>\n<p>Intermediaries are also licensed by the CNB and, like insurers, those licensed elsewhere in the EEA may conduct business in the Czech Republic based on the freedom of services or freedom of establishment principle (see question 7).<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Are there restrictions or controls over who owns or controls insurers (including restrictions on  foreign ownership)?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Persons who hold at least 10% of the insurance undertaking&#8217;s share capital or who exercise significant influence over the insurance undertaking must be notified to the CNB, including their personal data. Such persons must meet the requirement of proper and prudent management of the insurance undertaking.<\/p>\n<p>In addition, the insurance undertaking must notify the CNB of any changes in the ownership interest of persons whose ownership interest in the insurance undertaking is reduced or increased below or above 10% and, where applicable, obtain its prior approval if the change involves an increase of the ownership interest in the share capital by 20%, 30% or 50% or if the insurance undertaking becomes a controlled person.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Is it possible to insure or reinsure risks in your jurisdiction without a licence or authorisation?  (i.e. on a non-admitted basis)?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>The Insurance Act prohibits (re)insurance or intermediation activities without a licence. Unless the undertaking is conducting business in the Czech Republic from another EEA country based on the freedom of services or establishment principle, it cannot carry out these activities in the Czech Republic without a licence (see question 7).<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Is a branch of an overseas insurer, insurance broker and\/or other types of market intermediary in  your jurisdiction subject to a similar regulatory framework as a locally incorporated entity?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>(Re)insurers and intermediaries licensed in a non-EEA country wishing to provide insurance services in the Czech Republic must obtain a licence for this activity.<\/p>\n<p>(Re)insurers and intermediaries that have obtained the required licence in another EEA country are entitled to provide insurance services in the Czech Republic based on freedom of services or establishment if notified to the CNB.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Are there any restrictions\/substance limitations on branches established by overseas insurers?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Insurers from non-EEA countries are required to obtain the appropriate licence in the Czech Republic and therefore the extent of regulation is the same as for Czech insurers.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">What penalty is available for those who operate in your jurisdiction without appropriate  permission?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>An undertaking operating without a licence may be fined up to CZK 50,000,000 by the CNB. It may also be regarded as the criminal offence of unlawful business activity pursuant to the Criminal Code.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">How rigorous is the supervisory and enforcement environment? What are the key areas of  its focus?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Compared with other countries, the CNB is neither exceptionally strict nor benevolent in its approach to supervision and enforcement. Its approach could be described as formal and conservative, as it does not change its opinion often. The CNB publishes its expectations as regards various insurance market issues for each year in its benchmarks. Although the benchmarks are technically non-binding, insurers and intermediaries are expected to follow them and noncompliance is often penalised.<\/p>\n<p>The CNB is now paying increased attention to issues related to the price of products, such as value for money, price-walking practices and the provision of discounts. The CNB also continues to address consumer protection issues, in particular the transparency of costs and charges for individual insurance products.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">How is the solvency of insurers (and reinsurers where relevant) supervised?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>The insurance undertaking prepares an annual solvency report, which it publishes on its website. The calculation of the solvency capital requirement is approved in advance by the CNB.<\/p>\n<p>Pursuant to the Insurance Act, the insurance undertaking is obliged to maintain the applicable capital in the amount of the Solvency Capital Requirement (please see question 12 below).<\/p>\n<p>The CNB supervises the insurance market with respect to the insurance undertakings&#8217; compliance, including calculation and maintenance of the Solvency Capital Requirement.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">What are the minimum capital requirements?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>The minimum capital requirements depend on the type of insurance business conducted by the insurance undertakings and are the same as in other EU countries (based on the Solvency II Directive). The required amount must not be less than:<\/p>\n<ul style=\"padding-left: 0\">\n<li>EUR 2,500,000 for non-life insurance undertakings, including captive direct insurance undertakings (but excluding credit, surety and liability insurance, for which the requirement is EUR 3,700,000);<\/li>\n<li>EUR 3,700,000 for life insurance undertakings, including captive direct insurance undertakings;<\/li>\n<li>EUR 3,600,000 for reinsurance undertakings, except captive reinsurance undertakings, for which the requirement shall be EUR 1,200,000.<\/li>\n<\/ul>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Is there a policyholder protection scheme in your jurisdiction?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>The Czech Republic does not have a specific policyholder protection scheme. However, legal requirements such as solvency or minimum capital requirements indirectly serve to protect policyholders.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">How are groups supervised if at all?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Group supervision is regulated by EU law and implemented in Czech law. In EU law, group supervision is regulated by the Solvency II Directive. In the Czech Republic, group supervision is regulated by the Insurance Act.<\/p>\n<p>This means that the CNB supervises Czech (re)insurers that:<\/p>\n<ul style=\"padding-left: 0\">\n<li>hold a participation in at least one (re)insurance undertaking;<\/li>\n<li>are a controlled person of an insurance holding company domiciled in an EEA country or of a mixed financial holding company domiciled in an EEA country;<\/li>\n<li>are a controlled person of an insurance holding company established in a non-EEA country, a mixed financial holding company established in a non-EEA country, an insurance undertaking from a non-EEA country or a reinsurance undertaking from a non-EEA country; or<\/li>\n<li>are a controlled person of a mixed-activity insurance holding company.<\/li>\n<\/ul>\n<p>The supervision over the undertakings listed above is limited to:<\/p>\n<ul style=\"padding-left: 0\">\n<li>the maintenance of eligible capital at least equal to the group Solvency Capital Requirement;<\/li>\n<li>intra-group transactions;<\/li>\n<li>concentration of group risks;<\/li>\n<li>persons in the management of the insurance holding company and the mixed financial holding company; and<\/li>\n<li>compliance with the requirements of the management and control system at group level.<\/li>\n<\/ul>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Do senior managers have to meet fit and proper requirements and\/or be approved?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Persons performing key functions and all members of the statutory body must be fit and proper and must not have a conflict of interest that would affect their fitness and propriety. Any changes in those persons must by notified to the CNB, including provision of documents necessary to assess fitness and propriety.<\/p>\n<p>According to the CNB, the term &#8220;fit and proper&#8221; means criminal, professional and business integrity. The CNB assesses not only the documents submitted by the undertaking, but also publicly available information and information that the authority already has from its previous practice.<\/p>\n<p>If a person does not fulfil the above conditions, the CNB may order the replacement of that person or impose an obligation to remedy the deficiencies.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">To what extent might senior managers be held personally liable for regulatory breaches in  your jurisdiction?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>A senior manager is not personally liable for the regulatory breaches of the undertaking. However, they may be held liable for offences that are directly related to them and the procedures that they have violated, e.g. by failing to provide information requested by the CNB (a complete list is set forth in the Insurance Act).<\/p>\n<p>In private law, a manager may be held liable for damages if it is established that they have not acted in accordance with the duty of care.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Are there minimum presence requirements in order to undertake insurance activities in  your jurisdiction (and obtain and maintain relevant licenses and authorisations)?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Both the registered office and the head office of the undertaking must be in the Czech Republic in order to obtain and maintain the relevant licences. There are no requirements as to how many employees must actually work in the Czech Republic, but insurers must have a business organisation that is effective, orderly and proportionate to the nature, scope and complexity of their activities. It is also a condition that the number of employees and the size of the organisational structure must not limit or impede effective supervision by the CNB.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Are there restrictions on outsourcing services, third party risk management and\/or  operational resilience requirements relating to the business?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>In the Czech Republic (as elsewhere in the EU), a distinction is made between significant and insignificant outsourcing. The boundary between significant and insignificant outsourcing is unclear and consists of criteria such as total cost, financial and operational impact, difficulty in replacing the supplier, ability to meet regulatory requirements in case of complications with outsourcing or potential losses for the policyholder.<\/p>\n<p>Insurers are allowed to outsource any activities except for those that are significant, where such outsourcing would lead to substantial deterioration in the quality of the management and control system of the (re)insurance undertaking, an excessive increase in operational risk, deterioration of the ability of the CNB or another supervisor to monitor the compliance, or disruption of quality and continuous provision of services. If an insurer decides to outsource an activity, it must adopt a written outsourcing policy that must be approved by the board of directors. In case of significant outsourcing, insurers are required to notify the CNB (as well as any change or termination of the outsourcing agreement) and have the outsourcing contract approved by the board of directors.<\/p>\n<p>At the same time, to ensure the continuity and proper performance of its activities, the insurance undertaking must adopt contingency plans if the third party terminates its cooperation.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Are there restrictions on the types of assets which insurers or reinsurers can invest in or  capital requirements which may influence the type of investments held?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>The fundamental limit on the (re)insurer&#8217;s investment activities is the principle of prudent investment as set forth in the Insurance Act. The (re)insurer may only invest in assets whose risks it can properly identify, manage and report.<\/p>\n<p>All assets, particularly those intended to meet solvency and minimum capital requirements, should be invested in such a way as to ensure the security, liquidity and profitability of the overall portfolio. The allocation of these assets should not restrict their accessibility and should be diverse enough to avoid excessive dependence on any particular asset, issuer, group of persons or geographical area. Where the assets are intended to cover the (re)insurer&#8217;s obligations, the investment should be appropriate to the nature and duration of those obligations in order not to be detrimental to policyholders or beneficiaries.<\/p>\n<p>As regards unit-linked life insurance where the investment risk is borne by the policyholder, the insurance benefit may be linked to (i) the value of the investment fund&#8217;s participation lists, (ii) the value of the assets of the insurer&#8217;s internal fund, (iii) a share index or (iv) another benchmark.<\/p>\n<p>Moreover, no insurer is allowed to be a shareholder with unlimited liability in any corporation.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Are there requirements or regulatory expectations regarding the management of an insurer's reinsurance risk, including any restrictions on the level \/ type of reinsurance utilised?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>In the Czech Republic, there is neither any regulatory framework governing the reinsurance and the relationship between the insurer and the reinsurer nor any guidance formulated by the CNB. Nevertheless, the insurer must bear in mind its general obligation to ensure its security and stability, which plays an important role here as well.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">How are sales of insurance supervised or controlled?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Sales of insurance are primarily regulated by the IRDA, which imposes a number of obligations introduced by the IDD (EU Directive on insurance distribution).<\/p>\n<p>Distribution of insurance, like other aspects of the insurance business, is supervised by the CNB. It can inspect all participants in the distribution chain, insurers as well as intermediaries and policyholders who offer participation in group insurance and who at present are not technically intermediaries under the IRDA. However, an amendment to the IRDA is now being drafted, which is expected to include these policyholders as intermediaries. The CNB regularly publishes its benchmarks in respect of the sales process to introduce its regulatory expectations.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">To what extent is it possible to actively market the sale of insurance into your jurisdiction  on a cross border basis and are there specific or additional rules pertaining to distance selling or  online sales of insurance?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>An insurer or intermediary wishing to sell insurance in the Czech Republic must obtain the respective licence or, if already licensed in another EU\/EEA country, must notify its aim to the CNB.<\/p>\n<p>There are no specific requirements when selling insurance remotely or online, but some of the current ones may be more challenging (e.g. the requirement of written form in case of insurance contracts for a period longer than one year fulfilled by using an electronic signature that complies with the eIDAS Regulation, provision to the customer of all mandatory information and minutes of the meeting on a permanent data medium).<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Are insurers in your jurisdiction subject to additional requirements or duties in respect of  consumers? Are consumer policies subject to restrictions, including any pricing restrictions? If  so briefly describe the range of protections offered to consumer policyholders<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>In addition to the Civil Code, which implements most of the EU legislation, consumers are also protected by the Consumer Protection Act. This Act regulates certain business conditions relevant to consumer protection, as well as fairness of sales, prohibition of unfair commercial practices, information obligations and labelling, organised events and out-of-court settlement of consumer disputes. However, it does not set any specific price restrictions. As regards the negotiation of price terms, there is well-developed case law governing negotiation of bank charges and the attachment of fee schedules to the contract.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Is there a legal or regulatory resolution regime applicable to insurers in your jurisdiction?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Insurance disputes fall within the jurisdiction of the general courts. In addition, the Financial Arbitrator has jurisdiction over consumer disputes arising from life insurance. Regarding non-life insurance disputes, consumers can address the Czech Trade Inspection or the Office of the Ombudsman of the Czech Association of Insurance Companies. Disputes relating to an insurance contract concluded online can also be resolved via the online dispute resolution platform operated by the European Commission. The insurer is obliged to inform consumers about the possibility of ADR.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Are the courts adept at handling complex commercial claims?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Courts are the primary dispute resolution forum. However, the courts often struggle with complex commercial cases, especially when technical expertise is required. The process then tends to be excessively formalistic, simplistic and lengthy. Reaching a final decision can take a couple of years.<\/p>\n<p>Expert opinions are often key evidence in complex commercial cases. Unfortunately, the relevant legislation sets very strict requirements, which have a deterring effect on some experts, while at the same time reports of foreign experts are not formally perceived as expert opinions, even though they can be presented as evidence. In such cases it is important to secure a quality expert opinion, which can also serve as a basis for a reasonable settlement.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Is alternative dispute resolution well established in your jurisdictions?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Arbitration is well established but the general courts remain the main forum for resolving disputes. Arbitration is rarely used in disputes between insurers and their clients. In fact, arbitration clauses are prohibited in contracts with consumers. An insurer is more likely to become a party to arbitration in relation to an underlying claim by the injured party against one of the insurer&#8217;s clients.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Is there a statutory transfer mechanism available for sales or transfers of books of  (re)insurance? If so briefly describe the process<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>The Insurance Act regulates the transfer of (re)insurance portfolios. The (re)insurers concerned must apply to the CNB for approval of the transfer. In particular, the receiving (re)insurer must prove that it will continue to meet the minimum solvency requirements after the transfer. The transfer cannot be completed before the CNB&#8217;s decision is effective and final.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">What are the primary challenges to new market entrants? Are regulators supportive (or  not) of new market entrants?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Establishing a new insurance undertaking requires a lengthy procedure before the CNB. Not only does the law impose relatively strict capital requirements, but the CNB also sets high standards for proving the origin of capital. On the other hand, the CNB is reasonably supportive of the registration of branches of insurers licensed in other EEA country. However, the challenge may be to hire an adequate number of employees, as there are restrictions on cross-border outsourcing. Distributors are also required to pass a local professional competence test, which may be difficult for foreigners.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">To what extent is the market being challenged by digital innovation?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>We are currently observing two main trends in the field of digital innovation on the Czech insurance market.<\/p>\n<p>Firstly, there are continuing efforts by insurers to operate in a completely paperless manner. However, these efforts face obstacles in the form of a non-discriminatory approach to consumers requiring paper form as a stable alternative to electronic documentation as well as the requirement of the Civil Code to conclude insurance contracts arranged for a period of more than one year in writing. Proper fulfilment of these requirements is further impeded by the unclear case law related to the type (form) of the appropriate electronic signature used for signing insurance contracts.<\/p>\n<p>Secondly, there is constant interest in developing remote client onboarding processes, especially engagement of various comparison sites and online intermediaries. Nevertheless, the mass development of these methods is quite limited due to strict local AML regulation, especially due to specific rules on usable methods of client identification.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">How is the digitization of insurance sales and\/or claims handling treated in your  jurisdiction, for example is the regulator in support (are there concessions to rules being made) or  are there additional requirements that need to be met?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>In general, there is no regulation that prevents insurers from selling or handling claims digitally. The CNB does not pose any specific obstacles either. However, insurers must bear in mind that customers may request the paper form of a contract\/communication at any time over the life of the contract and the insurer must be able to provide it. When storing documents that have been completed electronically, the documents must be electronically timestamped in accordance with the eIDAS Regulation, and the validity of the timestamp must be regularly renewed.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">To what extent is insurers' use of customer data subject to rules or regulation?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>Apart from the confidentiality rule, there are no specific rules for insurers&#8217; customer data. This data is subject to the General Data Protection Regulation (GDPR) and, to a certain extent, the Czech Personal Data Processing Act. In addition, the Czech regulator, the Office for Personal Data Protection, issues opinions on selected personal data protection issues in the form of soft law.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">To what extent are there additional restrictions or requirements on sharing customer data  overseas\/on a cross-border basis?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>If the data is shared with non-EU countries, Chapter V of the GDPR applies. Basically, it is necessary to ensure that shared data is treated with an adequate level of protection in the non-EU country, i.e. the same level as the GDPR provides within the EU. For this purpose, standard data protection clauses are usually used. The clauses are not required in countries or territories where an adequate level of protection has been assessed by the European Commission by means of a GDPR implementing act. As far as the US is concerned, the standard data protection clauses are not required when dealing with companies that participate in the EU-US Data Privacy Framework.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">To what extent are insurers subject to ESG regulation or oversight? Are there regulations\/requirements, including in connection with managing climate change and climate  change related financial risks specific to insurers? If so, briefly describe the range of measures  imposed.<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>There is no local ESG legislation in the Czech Republic, but insurance undertakings are among the financial market participants covered by the EU ESG regulatory framework. Hence, they are subject to the Taxonomy Regulation and the Sustainable Finance Disclosure Regulation (SFDR), which impose sustainability information obligations on financial institutions. With effect from 1 January 2023, the SFDR has been supplemented by Regulatory Technical Standards (RTS) through a Commission Delegated Regulation.<\/p>\n<p>In addition, insurance undertakings may qualify as a large company for the purposes of the Non-Financial Reporting Directive (NFRD). The Corporate Sustainability Reporting Directive (CSRD) amends and extends the non-financial and sustainability reporting requirements under the NFRD.<\/p>\n<p>In terms of local specifics, the CNB issued a supervisory statement in 2024 clarifying the applicability of EU ESG legislation and soft law to insurance intermediaries. This year, the CNB intends to implement new supervisory tools and methodologies in the area of reinsurance and to engage in discussions with external providers of catastrophe models.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Is there a legal or regulatory framework in respect of diversity and inclusion to which  (re)insurers in your jurisdiction are subject?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>There are no specific laws or regulations on diversity or inclusion. Nevertheless, insurers are subject to the Anti-Discrimination Act, which imposes general anti-discrimination measures.<\/p>\n<p>The principle of equal treatment must also be followed when determining the amount of premium or calculating the insurance benefit. According to the Civil Code, such calculations are null and void if criteria such as nationality or pregnancy are taken into account. However, this does not prevent insurers from using age or medical disability as determining factors, provided that appropriate actuarial and statistical data are used.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\t\t\t\t\t<li class=\"question-block filter-container__element\">\r\n\t\t\t\t\t\t<h3 class=\"filter-container__match-html\">Over the next five years what type of business do you see taking a market lead?<\/h3>\r\n\t\t\t\t\t\t<button id=\"show-me\">+<\/button>\r\n\t\t\t\t\t\t<div class=\"question_answer filter-container__match-html\" style=\"display:none;\"><p>In general, we believe that risk coverage will dominate the market. In recent years, we have seen a boom in D&amp;O insurance, and we expect this trend to continue. There has also been a boom in cyber risk products, but these coverages have been limited recently due to disproportionately large claims. We also expect risk-based products to take the lead in the life insurance market, as investment life products have been burdened by a number of legal issues in the Czech Republic.<\/p>\n<p>We see a growing trend among insurance companies of seeking to be more of a partner to their insureds and addressing their problems more comprehensively. Insurers are increasingly moving away from simply providing a cash insurance benefit to offering further types of benefits, such as actual provision and arrangement for medical services, roadside assistance or vehicle repairs.<\/p>\n<\/div>\r\n\r\n\r\n\t\t\t\t\t<\/li>\r\n\r\n\t\t\t\t\r\n<div class=\"word-count-hidden\" style=\"display:none;\">Estimated word count: <span class=\"word-count\">4458<\/span><\/div>\r\n\r\n\t\t\t<\/ol>\r\n\r\n<script type=\"text\/javascript\" src=\"\/wp-content\/themes\/twentyseventeen\/src\/jquery\/components\/filter-guides.js\" async><\/script><\/div>"}},"_links":{"self":[{"href":"https:\/\/my.legal500.com\/guides\/wp-json\/wp\/v2\/comparative_guide\/104392","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/my.legal500.com\/guides\/wp-json\/wp\/v2\/comparative_guide"}],"about":[{"href":"https:\/\/my.legal500.com\/guides\/wp-json\/wp\/v2\/types\/comparative_guide"}],"wp:attachment":[{"href":"https:\/\/my.legal500.com\/guides\/wp-json\/wp\/v2\/media?parent=104392"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}