1. Basis of Insurance and Reinsurance Law 1.1 Sources of Insurance and Reinsurance Law
The primary source for Austrian insurance and reinsurance law is the Austrian Insurance Contracts Act, which primarily focuses on the insurance contract itself excluding the application to reinsurance contracts according to Section 187 of the Insurance Contracts Act and stipulates obligations for both the policyholder and the insurer. Besides, the Austrian Civil Code applies especially with regard to the conclusion and the interpretation of an insurance or reinsurance contract as well as the applicability of terms and conditions.
Obligations for insurers, reinsurers and intermediaries can be found in the Insurance Supervision Act and the Industrial Code. The Insurance Supervision Act imposes most of the organisational obligations for insurance and reinsurance companies: it primarily governs the organisational and regulatory framework especially regarding concession, legal form, capital and liquidity requirements and governance of insurance and reinsurance companies. The Industrial Code primarily governs the organisational and regulatory framework as well as the activities of intermediaries.
Furthermore, there are a number of European guidelines for example from the European Insurance and Occupational Pensions Authority (EIOPA) as well as advisory opinions and guidelines from the national Financial Market Authority (FMA). Many provisions in the stated law are derived from European Union legal acts such as the Directive 2009/138/EC on the taking-up and pursuit of the business of insurance and reinsurance (Solvency II) or the Directive (EU) 2016/97 on Insurance Distribution (IDD).
Even though the Austrian jurisdiction as such does not have precedents in general, unlike other countries, the jurisdiction of the Austrian Supreme Court still creates a somewhat binding effect for the lower courts: Decisions of lower courts usually will be set aside by the Supreme Court if they are not in accordance with jurisdiction of the Supreme Court.