Insurance service providers 

In the insurance business, one party agrees, for a fee, to cover the costs of an unforeseen damage or other loss to another party.

In practice, the insurance company and customer sign an agreement whereby the insurance company agrees to compensate the customer in the event that the customer sustains the damage or loss specified in the agreement.

Provision of insurance is subject to authorisation

Provision of insurance services by the insurance company is subject to authorisation. FIN-FSA grants authorisations for life and non-life insurance companies. Authorisations for employment pension insurers are granted by the Council of State.

Insurance business supervised by FIN-FSA

The insurance business is regulated and supervised, because insurance premiums are collected in advance and payers must be assured that the funds collected are always availabe to cover damages. The insurance business is supervised by FIN-FSA.

Insurance companies can sell other companies' products

In addition to selling insurance, life and non-life insurance companies can act as representatives of certain other companies and market and sell their services or products (related activities). Such companies include banks, management companies, investment firms and companies that engage in inspection or prevention of damages. When intermediating these products and services, insurance companies act as representatives of the respective companies and do not carry the associated risks.

Principle of separation of life and non-life insurance business

Life insurance and non-life insurance cannot be provided by the same company. In practice, however, life and non-life insurance companies often belong to the same group or form a financial consortium and operate under a single name. As a result, the customer will often find the names of several insurers in an insurance policy or offer.  Employment pension insurers may also be loosely afiliated with such a group or consortium.

15 February 2013