Bulgaria Property Insurance

Getting your Bulgarian Property Insured

Bulgaria Property Insurance - discount insurance and information about insuring your home overseas and the new laws associated.

In 1947, Bulgaria's private insurance companies became part of the State Insurance Institute. This also lead to a change requiring many within Bulgaria to hold insurance policies.

Since then, and according to Bulgaria's needs many types of insurances have been created to protect automobile liability, property purchase and rental, and workers' compensations. For that reason there are a number of insurance companies doing business in Bulgaria. The Ministry of Finance oversees regulates all insurance companies within Bulgaria. It is only in the past decade, that foreigners gained permission to own an insurance company within Bulgaria.

New Law

Desperate for laws that would enable Bulgaria to compete with other European nations and improve their own economy, the Bulgarian Parliament enacted a number of laws regulating many banking and insurance industries. These laws affected commerce, foreign investments, insurance companies, tax collecting, banking, and more. Additionally, in 1997 the government of Bulgaria began paying closer attention to the transactions of foreign companies who were doing business within Bulgaria.

These newer restrictions now require companies to have deposited a tidy sum into the Bulgarian National Bank before the business may set up shop. Not only does this help build revenue in the area, but it also ensures that companies have enough working capital to succeed. Current capital requirements are:

  • Approximately 2.5 million euros for limited liability businesses
  • 25 million euros for public companies without stocks
  • 50 million euros for public companies with stocks

There are neither strict restrictions nor any roadblocks for a Bulgarian to acquire shares in a Bulgarian company. Foreigners must have permission from Bulgaria's Financial Supervision Commission.

There are three legal practices in which you can sell or purchase insurance: a public company, a foreign insurance business that has a location within Bulgaria, and an insurance cooperative. In order to carry out those activities a person must obtain a license from the National Insurance Council. The required minimum in working capital for any foreign insurance business or public insurance company is:

  • BGN 2 billion (approximately 1 billion euros) - for life insurance
  • BGN 3 billion (approximately 1.5 billion euros) - for property insurance
  • BGN 4 billion (approximately 2 billion euros) - for re-insurance

Insurance companies must have registered shares available to supply the insurance policies. When filling in the application form for obtaining an insurance activity permit, the cash capital of the Bulgarian insurers and the deposit for the branch of a foreign insurer must be paid in full at the Bulgarian National Bank. While this is a staggering amount of money, this rule is compulsory.

No shareholder is entitled to buy shares without the written permission of the National Insurance Council with the Council of Ministers. This cannot be done either directly or indirectly. These shares constitute 5 % or a bigger percentage of the total capital of the insurance company.

After obtaining a license by the National Insurance Council with the Council of Ministers, a foreign insurer and investor can carry out insurance and re-insurance activities on Bulgarian territory through a branch office. The office must be registered by a Bulgarian court and the capital investment deposited into the Bulgarian National Bank can never be less than the minimums mentioned above.

Another way to sell and purchase insurance is through a mutual cooperative. A mutual cooperative insurance company may never have fewer than 500 legal members. All founding members must purchase an insurance policy with their cooperative. They must also make all yearly payments for the insurance they choose.

Property Insurance

It is advisable to understand clearly what is being insured as well as the reach of the insurance policy; foreigners should get those documents translated into their own languages in order to do that. However, insurance fees are cheaper in Bulgaria than in the rest of Europe, and much cheaper than in the UK, so it may be worth the effort.

After the high peak of foreigner investors in Bulgaria, companies have updated their offers to keep up with that situation. Once a property is bought, it is necessary to insure the property, pay the local government service fees, pay any government taxes as they become due, and ensure the home is secure when the owners or renters are away. For that reason some insurance companies have a variety of insurance plans and services that will help you protect your home and provide more information on your requirements.

Owning a car in Bulgaria

Car owners in Bulgaria, both citizens and other residents, are required to pay a few annual fees. These fees include:

  • Accident and Theft Insurance (800€ to 1000€)
  • Driver Protection Insurance (50€ annually)
  • Mot (Approximately 12€ annually)
  • Road Tax (Dependent on the vehicle's engine power)