New regimen for compulsory environmental insurance
By means of Decree N° 447/2019 (the "Decree") the Executive Branch introduced modifications to the legal regimen of compulsory environmental insurance provided in Article 22 of Law N°25.675, tending to diversify the instruments by which that obligation may be fulfilled.
The new norm established that those human or legal persons, public or private, that carry out activities risky for the environment, ecosystems and their constituent elements may comply with the obligation established in Article 22 by contracting (i) a Collective Impact Environmental Damage Bonding Insurance (ii) Insurance Policies with Risk Transfer or,(iii) other financial instruments or Insurance plans that are approved by the Secretariat of the Government of Environment and Sustainable Development and the Superintendence of Insurance of the Nation. It is also ratified that the existing coverage and the Insurance plans to be approved must guarantee the effective remediation of the damage caused up to the minimum insurable amount.
On the other hand, the Decree empowers the Secretariat of Environment and Sustainable Development and the Superintendence of Insurance of the Nation to dictate, within the scope of their respective competencies, the regulations that could be complementary, which suggests that there could be more novelties soon.
For further information on this topic please contact María Morena Del Río