The State Financial Supervisory Authority (PSzÁF) announced on Wednesday it has prohibited MÁV General Insurance Association from signing any new mandatory car insurance contracts between June 2 and September 30 in order to allow the company time to expand its data processing system.
The system must be updated to ensure driving records are taken into account when determining premiums, procedures for paying out claims on damages are in line with requirements and the company can meet its obligation to provide data. The suspension will not affect the company's existing stock of mandatory car insurance policies.
MÁV General Insurance Association had revenue from premiums of Ft 2.2 billion in 2005, more than triple the amount in 2004. Premium revenue on mandatory vehicle policies came to Ft 1.5 billion in 2005, giving the company a 0.32% share of the market. In the first quarter of 2006, it increased its market share to nearly 0.8%.