Regulatory Alerts2012-11-06
FMA Circular 05/2012 on Backdating of Insurance Contracts
The German Federal Financial Supervisory Authority (FMA) issued Circular 05/2012 to restrict the practice of backdating insurance contracts, defining it as setting the coverage start date before the contract conclusion. The regulator deems backdating generally inadmissible because it is often used to circumvent regulations regarding interest rates, age-based premiums, unisex scales, and government subsidies. Backdating is permitted only in exceptional cases where insurers can document legitimate legal or tax reasons, and any such period must be limited to a few weeks to avoid supervisory measures.
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