Place of risk

In which country a risk is situated is important for determining which regulatory and tax requirements are relevant.

Risks situated in the EU / EEA

In the EU / EEA , the risks located as determined by the Second Council Directive 88/357/EEC of 22 June 1988 on the coordination of laws, regulations and administrative provisions relating to direct insurance other than life assurance and laying down provisions to facilitate the effective exercise of freedom to provide services and amending Directive 73/239/EEC

Article 2 (d) ´Member State where the risk is situated' means:

• the Member State in which the property is situated, where the insurance relates either to buildings or to buildings and their contents, in so far as the contents are covered by the same insurance policy,
• the Member State of registration, where the insurance relates to vehicles of any type,
• the Member State where the policy-holder took out the policy in the case of policies of a duration of four months or less covering travel or holiday risks, whatever the class concerned,
• the Member State where the policy-holder has his habitual residence or, if the policy-holder is a legal   person, the Member State where the latter's establishment, to which the contract relates, is situated, in all cases not explicitly covered by the foregoing indents;

You can find an overview of the legislation here.

Risks located in Switzerland
The EU / EEA place of risk rules also apply for Switzerland based on an agreement between the European Economic Community and the Swiss Confederation on direct insurance other than life insurance.

Risks located in the rest of the world
In the rest of the world there is no harmonization of risks located. In every country there are different rules. In some cases, the country of the domicile of the policyholder, in part, the residence of the insured person or even just the place where an insured object is situated. To some extent the so-called non-admitted business is allowed, i.e. that under certain conditions (e.g. the insurer is passive in a country / does not engage in insurance activities in a country) without additional local license an insurer may insure risks in this country. Each country must be examined for each sales channel, for each product and for each risk category .

As a harmonization approach, there is the " Code of Liberalisation " of the OECD countries with the so-called correspondence insurance. Here, the insurer would be passive and the active customer applies for insurance. This approach, most countries have, however, restricted or excluded.