Brussels, 25/10/2000 (Agence Europe) - The European Commission called on Italy to put an end, within three weeks, to the price freeze on third party motor vehicle insurance. "After a detailed study of Italy's reactions to a letter of formal notice dated 13 July, (it) takes the view that this price freeze is incompatible with the freedom to market insurance products within the European Union (…), does not form part of a general price control system, nor is it justified by considerations of general interest", explained the spokesperson in the press release. The Commission sent a motivated opinion to the Italian authorities (second stage in the infringement procedures). Once the three week deadline expired, it will be able to decide on referring to the Court of Justice.
The European Commission questions the Decree-law adopted last 28 March by the Italian government, including urgent provisions for the limiting of inflationary tendencies. These provisions notably aim to: a) establish for one year a price freeze, as of 29 March 2000, for all new contracts including a price formula that foresees changes on the basis of accidents, b) ban over the same period to increasing of premium for the insured whose contracts expire, c) force all insurance companies operating in the "third party motor vehicle" branch to offer a policy incorporating no-claims system with an absolute excess, of between ITL 500,000 and 1,000,000. These limitations are applicable to policies taken by electronic or telephone means, including from another Member State of the European Union.
According to the European Commission, they are "likely to discourage or even prevent non-traditional operators from entering the Italian market". "Deprived of their ability to make more interesting offers, they will find it more difficult to win customers", it noted.