FAS wants to prohibit banks from creating advantages for choosing a certain insurer

The Federal Antimonopoly Service (FAS) has developed a draft government decree which would bind to specific insurance companies when applying for a loan, the Izvestia newspaper reported with reference to the document and confirmation of the service. The FAS informed the publication about the work on such document in September. According to the details of the project that emerged, the regulator intends not to allow the banks to allow the borrower to buy the policy from a particular insurance company. The draft document implies that the bank will not only have to accept the policy from the insurance company chosen by the client among the top-rated companies, but also change it after the loan issuance, without worsening the loan conditions. The Federal Antimonopoly Service proposes to use the data of four rating agencies – Analytical Credit Rating Agency, Expert RA, National Rating Agency and National Credit Rating Agency – to determine a company’s trustworthiness. According to the rules developed by FAS, the banks will have to provide borrowers with the information on what company’s rating is considered minimal acceptable and what insurance companies are suitable for concluding an agreement. Also, the banks will have to notify on deterioration of the conditions in case the client chooses the insurance company that does not meet the bank’s requirements. In September “Izvestia” reported that the condition for approval would be a positive rating in one of the aforementioned agencies. Now the Federal Antimonopoly Service has clarified to the publication that the minimum acceptable credit rating will be spelled out in a decree and banks will be able to lower the threshold.