BaFin announces stricter rules for insurtechs

Young insurance companies are planning too little money, Bafin criticizes. Now the supervisory authority wants to take stricter action against this.
The Federal Financial Supervisory Authority (BaFin) wants to regulate insuretechs more strongly in the future, as it announced last week. In the "BaFin Journal", the authority criticizes that young insurance companies would often plan too little money in the beginning. Therefore, start-ups should have to show more own funds in the future than before.
"The BaFin publication only refers to a very small part of the insurtechs, namely the neocarriers that already have an insurance license - which is currently only a little more than a handful in Germany," Nikolai Dördrechter, Managing Partner at XTP, tells the online portal Versicherungsbote. He therefore predicts fewer start-ups: "Setting up neocarriers with their own BaFin licence will require significantly more capital in future than in the past. This reduces the return from an investor's point of view. "Criticism also comes from the lawyer for banking supervisory law Frederik Winter. "With the requirement for a complete out-financing at the time of licensing, however, the supervisory authority interprets the legal requirements very strictly and extensively," he told Handelsblatt
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