BaFin announces stricter rules for insurtechs

Young insurance companies plan too little money, criticizes Bafin. The supervisory authority now wants to take stricter action against this.

The German Federal Financial Supervisory Authority (BaFin) wants to regulate insuretechs more strictly in future, as it announced last week. In the "BaFin Journal", the authority criticizes the fact that young insurance companies often plan too little money at the beginning. In future, start-ups will therefore have to provide more own funds than before.

"The BaFin publication only refers to a very small proportion of insurtechs, namely the neocarriers that already have an insurance license - which is currently just over a handful in Germany," says Nikolai Dördrechter, Managing Partner at XTP, the online portal insurance messenger. He therefore predicts fewer start-ups: "Setting up neocarriers with their own BaFin license will require significantly more capital in the future than before. This reduces the return from an investor's perspective. "Criticism also comes from banking supervision lawyer Frederik Winter. "With the demand for complete funding for licensing, the supervisory authority is interpreting the legal requirements very strictly and extensively," he told the Handelsblatt.