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Concerns about insuring state assets

A STATEMENT by the Finance Ministry that it is not necessary for the state to have commercial insurance policies over the long term and that some state institutions and bodies should terminate their policies was met with disagreement from many of these organisations, the SITA newswire wrote in late February.

A STATEMENT by the Finance Ministry that it is not necessary for the state to have commercial insurance policies over the long term and that some state institutions and bodies should terminate their policies was met with disagreement from many of these organisations, the SITA newswire wrote in late February.

The ministry prepared a proposal for what it called a systematic solution for insuring state assets with commercial insurance companies, stating that it prefers to retain the funds currently paid for insurance for coverage of potential damages, recommending at the same time that some insurance policies be terminated.

The ministry reported that during the last five years the state paid €41.6 million in premiums to insure its assets but reimbursed insurance claims amounted to only €5.2 million.

The Slovak Insurance Association (SLASPO) said that it does not agree with the ministry’s perception of the effectiveness of insurance, stating that insuring assets is not meant to act as an investment and it is impossible to calculate an economic return analysis as the ministry had done.

“Not covering state assets, with a value reaching billions of euros, with commercial insurance is a hazard with potentially heavy losses which especially threaten as a consequence of climate changes,” SLASPO wrote in a statement.

Among those state bodies disagreeing with the Finance Ministry’s proposal is the Culture Ministry which argued that the value of some items of cultural heritage is incalculable. The Ministry of Agriculture also stated it is against the proposal.


Topic: Finances and Advisory


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