for Foreign Insurers
a comprehensive insurance practice. The firm serves foreign clients to
launch insurance products in Finland and assists them in regulatory
matters with the authorities. She had a long history in the insurance
business before starting her career as an attorney.
Keskuskatu 8
P.O. Box 1077
Helsinki, Finland 00101
+358 10 3090 300 Phone
+358 10 3090 333 Fax
tiina.ashorn@procope.fi
www.procope.fi
foreign insurance companies in Finland
has grown every year. According to the
Federation of Finnish Financial Services,
there were 39 domestic companies and
29 branch offices of foreign insurance
companies in Finland at the end of 2011.
When planning its operation, a for-
eign insurer operating in Finland should
become familiar with local legislation
and local business conduct. The central
Finnish law is the Finnish Insurance
Companies Act, which requires incorpo-
ration and licensing in Finland in order
to conduct insurance activities here. The
Insurance Contracts Act regulates the
relationship between the insurer and the
policyholder.
In addition to Finnish insurance
companies, foreign insurance companies
also can carry on insurance business in
Finland. The Act on Foreign Insurance
Companies (398/1995) is applicable to
all foreign insurance companies con-
ducting insurance business in Finland.
According to the Act, foreign insurance
companies are divided into two groups
European Economic Area (foreign EEA
insurance companies) or outside that
area (third country insurance compa-
nies). An insurance company registered
in an EEA state (EU, Iceland, Norway
and Lichtenstein) can establish a branch
in Finland or notify that it carries on
insurance business on the freedom of
services basis cross-border without
having a branch in Finland. Insurance
companies other than those established
in one of the EEA states must have a
license in Finland and the company must
establish a branch in Finland.
The financial standing of a foreign
EEA insurance company is overseen
by the supervisory authority of its home
state, also with respect to its branch in
another EEA state. The Finnish Finan-
cial Supervisory Authority (FIN-FSA)
only has limited authority in supervising
the operations of a foreign EEA insur-
ance company operating in Finland. In
order to operate in Finland, a branch
of a third country has to fulfill certain
statutory basic capital requirements
in Finland.
In addition to insurance companies,
insurance agents and insurance brokers
also can offer insurance. Insurance
agents and insurance brokers have
been clearly separated from each other.
Agents operate for and on behalf of an
insurance company and receive commis-
sion from the company. Brokers, on the
other hand, operate for and on behalf of
a client and receive commission from the
policyholder. In Finland, an insurance
company cannot pay the broker's fee.
The activities of an insurance intermedi-
ary are governed by the Finnish Act on
Insurance Mediation. The Act contains
provisions relating to registering and
reporting with the FIN-FSA and to the
disclosure obligations of the intermedi-
ary. The insurer is bound by the advice
and information provided to the policy-
holder by its agent. An independent in-
surance broker is not a representative of
an insurer under the Insurance Contracts
Act and the insurer is not responsible
for information given by the broker. If