Spanish risk managers gain important seat at legislative table

As technologies disrupt the insurance industry, regulation will have to follow suit. It is good news therefore that Spanish risk managers have gained a voice in a government body that will help shape the country’s insurance legislation of the future.

Lourdes Freiria, the head of risks and insurance at construction firm Grupo San José, has been chosen to represent IGREA and AGERS, Spain’s two risk management associations, at Junta Consultiva de Seguros, a group of experts that advise the Spanish government on issues related to the insurance industry.

“One of our goals has always been to have a presence in legislative institutions,” celebrated Daniel San Millán, the president of IGREA, during the association’s annual conference in Málaga, Southern Spain.

The committee, which is maintained by DGS, Spain’s insurance regulator, was created in 1908 and is composed by representatives from underwriters, pension funds, loss adjusters and brokers, as well as consumer associations, academics, DGS staff members and other experts with links to the insurance industry.

The body did, however, lack the practical knowledge about the management of large risks and commercial insurance. Since 1987, no risk managers have been members of the committee.

But the associations contacted DGS to try and fill this gap, and Freiria was finally appointed to the body in September 2022.

The Junta’s main goal is to advise Spain’s Ministry of Finance, to which DGS is subordinated, about the regulation of the insurance market.

It produces reports, studies and even legislative proposals that help DGS to draft the rules that will be submitted to the Spanish parliament.

“We wanted to reintegrate risk management, as you represent large companies,” said Ana García, a director at DGS who is in charge of the group. “Also the opportunity of you telling us things that we at the government do not know. You also have a point of view that is different from other consumers represented in the committee.”

Since Freiria joined the group, two sessions have already been held. In one of them, participants discussed the impact on the insurance market of the transposition into Spanish law of a European directive on the circulation of vehicles.

One of the clauses within the bill drafted by the government had an impact on risks faced by companies, as it defined what was a motorized vehicles and what its circulation entails, Freiria explained.

“An opportunity presented itself to solve a problem that risk managers have been facing, which relates to self-propelled machinery,” she said.

Freira noted that risk managers have had to face doubts on whether such machinery requires a mandatory insurance cover in Spain. The law was not clear about it, which created issues especially concerning with machinery leased from third parties.

“This question was analysed concerning the bill, and the explanation we provided will help to increase legal security to the market,” she remarked.

If the bill is approved by the Parliament, such machines will be treated as vehicles and subject to mandatory insurance. Whether that will be the case, however, will only be known after a new Spanish Parliament is elected, on July 23.

To potentialize their participation in the legislative process, IGREA and AGERS have constituted a working group to discuss their joint contributions to the body.

“It is important because it is a point of view that was missing to the committee,” García pointed out.