For the first time, the legislation introduces binding deadlines for the assessment and settlement of payment claims. The FGA is now required to issue a decision within three months and to pay compensation within a similar timeframe. Failure to meet these deadlines is no longer treated as a passive consequence of administrative overload, but becomes a sanctionable breach, triggering penalty interest. In a market where delayed payments have become almost systemic during insurer bankruptcies, the law shifts responsibility from the abstract to the concrete: internal processing constraints can no longer be used as an excuse, as the pace is now set by law.
A major structural change concerns the compensation limits, one of the most sensitive issues for claimants. The law abolishes the former general cap of RON 500,000, replacing it with a significantly more consumer-friendly mechanism. Under the new framework, the FGA will compensate claims up to the maximum liability limit of the insolvent insurer’s MTPL (RCA) policy.
Crucially, this limit is not fixed. It is defined as the higher of the statutory limit applicable in the country where the accident occurred and the contractual limit of the MTPL policy. In effect, claimants benefit from the highest level of protection available under either national legislation or contract terms, aligning Romania’s system with Directive (EU) 2021/2118. In severe cases exceeding standard thresholds, this change can mean the difference between full recovery and substantial uncompensated losses.
Romanian MTPL legislation currently requires insurers to provide coverage of more than EUR 6.07 million for bodily injury or death and EUR 1.22 million for property damage per event.
The law also introduces a rethink of how the FGA manages its priorities. For the first time, it explicitly acknowledges situations that warrant moral urgency. Claims submitted by the heirs of minors killed in road accidents, by individuals who have lost their ability to work, or by beneficiaries of monthly annuities must now be treated as priority cases. This is more than a procedural exception; it represents a legislative decision to inject a measure of humanity into an otherwise technical administrative process.
At an institutional level, the legislation redefines the relationship between the FGA and insurers, both domestic and European. Protection is extended to liquidation scenarios not necessarily linked to insolvency, a critical nuance in a market characterized by complex corporate structures and multinational groups. The law also establishes advanced cooperation mechanisms with counterpart guarantee bodies in other EU member states, including reimbursement procedures for cross-border claims. This reflects the reality of an increasingly mobile European market, where MTPL policies and accidents no longer stop at national borders.
In a notable departure from the Fund’s traditional architecture, the law opens the door to active financial instruments. In exceptional circumstances, the FGA may now borrow from the Government, with a state guarantee, when its own resources prove insufficient. In effect, the state explicitly assumes the role of lender of last resort for the guarantee mechanism. The Fund is also authorized to enter into reinsurance-like arrangements and to generate income through services such as loss assessment on behalf of insurers. This financial recalibration lays the groundwork for a more resilient, flexible Fund, better equipped to withstand large-scale insurer failures of the kind seen in recent years.
Discipline and accountability form another substantial pillar of the reform. For the first time, the sanctions regime applies symmetrically to insurers and their management, as well as to the FGA and its leadership. Fines can reach up to RON 500,000 for insurers failing to meet reporting or documentation obligations, with individual penalties applicable to board members and executives. In parallel, the FGA itself may now be sanctioned for exceeding statutory deadlines for claim assessment or payment - a provision absent until now and one that reinforces the principle that policyholder protection is a legal obligation, not a discretionary service.
The law also provides much clearer definitions of key concepts, including who qualifies as an “MTPL injured party,” the distinction between direct and indirect creditors, and how cross-border reimbursements operate. In a legal framework long marked by ambiguity, these clarifications significantly reduce the scope for divergent interpretations.
Taken together, the new legislation transforms the FGA from an institution that merely manages the aftermath of insurer failures into one capable of mitigating their most damaging effects, through stronger financial tools, accelerated procedures, and full integration into the European policyholder protection ecosystem.
President Nicușor Dan signed the decree promulgating the Law amending and supplementing Law No. 213/2015 on the Policyholders’ Guarantee Fund and Law No. 85/2014 on insolvency prevention and insolvency procedures on Wednesday.
The law had been adopted by Parliament on 12 November 2025, following nearly a year of delays and repeated postponements in the Chamber of Deputies, the decision-making body in this case. The Senate had approved the draft as early as March 2024.
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