Austria Insurance Information

CIA link to demographic/economic data on Austria

General Austria Insurance Information

• Compulsory Insurance:
  1. Automobile Third Party Liability;
  2. Workers’ Compensation;
  3. Aviation Third Party Liability;
  4. Product Liability - Pharmaceutical Companies;
  5. Professional Indemnity for certain professions;
  6. Pollution Liability;
  7. Nuclear Operators;
  8. Pipeline Operators;
  9. Insurance Brokers;
  10. Genetics Technology Operators;
  11. Electronic Signature Certificators
• Non-Admitted Insurance:
  Not prohibited for policies issued under the single license provisions of European Union. Permitted, but if coverage available locally, then a punitive tax will be applied (5 times normal premium tax). Intermediaries are forbidden to service non-admitted coverages.
• Policy Wordings & Rates / Tariffs Controlled:
  As from January 1, 1994 insurers no longer are required to submit tariff rates to the Ministry of Finance. Policy forms continue to require the authorization of the MOF’s Insurance Supervisory Authority.
• Policy Language:
  German unless the insured has chosen another language, or opted for a foreign jurisdiction clause.
• Types of Insurance Restricted to Government Institutions:
  Workers’ Compensation. Employees have no rights against employers.
• Policy Currency:
  euro (EUR)
  note: on 1 January 1999, the European Monetary Union introduced the euro as a common currency to be used by financial institutions of member countries; on 1 January 2002, the euro became the sole currency for everyday transactions within the member countries. U.S. Dollar insurance is available for all lines.
• Currency Restrictions / Exchange Controls:
  No restrictions. Foreign currencies can be used for all lines.
• Policy Period:
  Normally 10 years except for automobile insurance which is renewed annually. Long Term Agreements (LTAs) are normal.
• Cancellation Provisions: (Interestingly, insurers and insureds are entitled to cancel following two or more claims resulting in a loss ratio of more than 100%.)
• By the Insured: 3 month written notice of intention to non-renew prior to the end of the policy period (or after 3 years or after a claim).
  By the Insurer: Same as Insured.
• Premium Taxes, etc. payable by Insured:
  Normally 11%. Fire Brigade charges apply to Property Damage and Business Interruption insurance in the amount of 4% (another 4% is part of the premium) – paid 50/50 by insured and insurer. Exceptions to the basic premium tax are 4% for Personal Accident and Life Insurance, 1% for Health Insurance and 0.2% on the sum insured for Hail Insurance. All business premiums are tax deductible.
• Insurance Companies:
  Domestic companies must be either joint stock companies or a mutual insurance society. The are no restrictions on foreign ownership of domestic companies. There are no restrictions on banks owning insurance companies. A significant number of multinational companies operate in Austria.
• Brokers:
  Brokers control only about 20% of the market. Most insurers work with their agency systems.
• Brokerage Commissions:
  Commercial - 15%;
  Personal Lines - 80-90% 1st year, 15% thereafter.
• Broker of Record Letters:
  Required.
• Reinsurance:
  There are no limitations on non-admitted reinsurers. There are no obligatory cessions in Austria.
• Local Natural Hazards:
  Danube River Flooding.

Property Insurance

Fire: Standard fire perils include - fire, lightning, aircraft, explosion. Earthquake, flood, storm / tempest, burst water pipe, riot / civil commotion, malicious damage, windstorm / hurricane, vehicle impact and weight of snow / avalanche are available in the local market for additional premium.

All Risk: Usually reserved for Builders Risk, Contractors Equipment and Machinery Installation.

• Coinsurance:
  Not usual
• Blanket Insurance:
  Available.
• Business Interruption:
  Loss of Profits form generally used including continuing charges and payroll expense.
• Replacement Cost:
  Available.
• Discount for fire protection equipment / systems:
  Max. 50%.
  

Boiler & Machinery / Machinery Breakdown / Engineering

• Wordings:
  Local insurance available which covers machinery breakdown, machinery installation, and business interruption. Annual inspections are required by law.

General / Public Liability

• Available Wordings:
  Local.
• Comments:
  Coverage is usually written on an occurrence basis and can be extended to cover Product Liability, Personal Injury and Limited Pollution Liability, etc. Punitive Damages are not provided for under Austrian law.

Automobile / Motor

• Compulsory Limits:
  AS12 million per accident.
• Comments:
  Operators of insured vehicles are covered as well as any licensed individual driving with the Insured’s permission. Passengers are deemed to be Third Parties (excluding close relatives).

Workers’ Compensation

• Comments:
  All employees, including foreign nationals are covered under the Government Social Security Scheme. Extra-Territorial benefits are available. Medical Expenses and certain Occupational Diseases are covered. Employer’s Liability coverage is provided under the General / Public Liability Policy.

Marine

• Available Wordings:
  Local and foreign - War and Strike rates follow London scale.

Crime

• Available Coverages:
  Local forms available for fidelity, burglary, surety, etc.