​The fixed monthly contribution paid by RCA insurers to the Policyholders’ Guarantee Fund (FGA) to compensate insolvent insurers will be halved from March 1, 2024, according to an ASF rule published in the Official Gazette on Tuesday.

• SEE – ASF RULE REDUCING CONTINUOUS CONTRIBUTIONS TO FGA

The Insurance Guarantee Fund (FGA) pays for insurance bankruptcies mainly from funds collected from solvent and active insurers in the insurance market.

There are two types of contributions that insurers are required to remit to the FGA from the gross premiums collected each month from general insurance sales (predominantly RCA):

• fixed premiums, money that is no longer returned to insurers
• special contributions, money that will be returned to insurers when the availability of the FGA is sufficient to cover the amounts due to insurance creditors and to the extent that the Fund is provided with the financial resources required by law.

Insurers currently have to pay the FGA a flat rate of 4% and a special rate of 3% for non-life insurance, but from 1 March they will have a flat rate of 2% and a special rate of 5%.

In other words, from March 1, 2024, insurers will transfer the same amount of money to the FGA every month, only the amount of money that is transferred forever and is no longer refundable has been halved.

The measure adopted by the ASF was proposed by insurers to offset the negative impact of RCA’s truck price cuts.