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Maxim Kolev, Chairman of the Guarantee Fund, in an interview for Mediapool.bg: "The toll system will detect vehicles without MTPL insurance"
30 September 2025
Legislative amendments, new technological solutions, and alignment with European regulations mark an important stage in the development of the Motor Third Party Liability (MTPL) insurance system in Bulgaria. On this occasion, the Chairman of the Guarantee Fund, Maxim Kolev, gave an interview for Mediapool.bg, presenting the main directions of development and the current readiness of the Fund on key topics. Below are the main highlights:
New functionalities of the toll system will detect vehicles without valid MTPL insurance
Two years ago, during the Easter holidays, the first tests were carried out to verify the validity of MTPL insurance through integration between the systems of the National Toll Administration, the Ministry of Interior and the Guarantee Fund. The period was suitable due to the intensified traffic, and the results clearly showed that verification through the toll system is an effective tool – in just six hours, 2,971 uninsured vehicles were identified. Based on this, the Guarantee Fund proposed legislative changes that have already been adopted – they entered into force with the amendments to the Road Traffic Act and the Insurance Code, passed several months ago.
The authority responsible for detecting violations via the toll system cameras is the Road Infrastructure Agency (RIA), and the sanctioning body is the Ministry of Interior. The system is expected to be operational soon, and violators will begin receiving electronic fines similar to those issued for traffic violations. The sanction for driving a vehicle without valid MTPL insurance remains unchanged – 250 BGN for a first offense by a natural person and 400 BGN for a repeated violation.
According to recent data, the coverage rate of MTPL insurance varies by season and currently exceeds 98% of all vehicles that are duly registered and not suspended from operation.
Maintaining this high coverage is of key importance, as one of the main roles of the Guarantee Fund is to pay compensation to victims of road accidents caused by vehicles without valid MTPL insurance. The more drivers are insured, the more secure and stable the system is for all road users.
The coverage is measured based on vehicles that are registered, not suspended from operation, and not deregistered. There are over 3.6 million vehicles in Bulgaria, which means that depending on the season, between 30,000 and 60,000 vehicles on the road are uninsured.
One of the measures undertaken by the Guarantee Fund to maintain high coverage is sending written notifications to vehicle owners about the lack of a valid and active policy. If the insurance is not concluded within the legally established period, the Fund submits information to the Ministry of Interior, which then proceeds with the administrative deregistration of the vehicle. In such cases, the vehicle may still have license plates and the driver may assume they are compliant, but in reality, the insurance is missing, and the vehicle is deregistered. These drivers risk being penalized. These vehicles are not included in the coverage statistics, as they are officially considered deregistered.
In addition, there are types of vehicles not subject to mandatory insurance – such as agricultural machinery, which can still cause damage; trailers up to 750 kg; self-propelled machines with engine power up to 10 kW; motorized bicycles; and self-balancing vehicles.
A decentralized bonus-malus model is being introduced
The previous concept in the Insurance Code was based on a unified bonus-malus system for all insurers, with uniform coefficients for bonus or malus for each driver, generated by the information system of the Guarantee Fund. It was envisaged that when policies were issued through the system of the Fund, a correction coefficient would be automatically applied to reflect the traffic violations committed by the driver with the insured vehicle.
With the recently adopted amendments to the Insurance Code, the model has been changed – instead of a unified system, a decentralized model is being introduced, in which each insurer develops and applies its own bonus-malus system for MTPL insurance based on actually caused damages. This approach allows insurers to compete under real market conditions and to apply adequate pricing according to their own criteria, based on the data they possess in their internal systems. The Guarantee Fund will provide information regarding the claims history of vehicles. This approach is a good start for fair assessment and transparency in the individual pricing of the insurance.
The role of the Guarantee Fund is to provide information about the claims history of a particular vehicle so that insurers can assess what bonus or malus to apply in their pricing process.
The Financial Supervision Commission is expected to adopt the necessary ordinances that will help insurers finalize their bonus-malus systems and publish information about them on their websites. We expect these ordinances to ensure the process is fully automated, without requiring customers to submit certificates for claims history, regardless of whether they have changed insurers over the years. For cases where the insurance is concluded abroad and citizens need the certificate for bonus-malus purposes in the foreign country, the ordinances are expected to allow Bulgarian insurers to issue the necessary documents on behalf of the Guarantee Fund.
In parallel, the Guarantee Fund will create an online service via RegiX (maintained by the Ministry of e-Government), which will enable remote issuance of certificates regarding the claims history of a specific vehicle.
The lifting of the monitoring over the Bulgarian National Bureau brings positive developments, including the opportunity for representatives of the Bureau and the Guarantee Fund to participate in the upcoming elections for the Supervisory Board of the Council of Bureaux
At the latest General Assembly of the Council of Bureaux, a decision was made to lift the monitoring over the Bulgarian National Bureau of Motor Insurers (BNBMI). The most significant result of this is the elimination of the heavy financial requirement for a collective reinsurance agreement for insurers offering MTPL insurance, which had been imposed as a corrective measure in 2018. The Bureau also regained its rights to participate in working groups and committees of the Council, as well as the right to vote in the
General Assembly. This opens the possibility for representatives of the Bureau and the Guarantee Fund to participate in the upcoming elections for members of the Supervisory Board of the Council of Bureaux.
The latest amendments to the Insurance Code provide a mechanism for compensating victims in accidents caused by personal light electric vehicles – primarily electric scooters
In Bulgaria, the legislator has stipulated that electric scooters must be covered by mandatory MTPL insurance for motorists. This requirement is included in the recent amendments to the Road Traffic Act, but specific mechanisms for its implementation are yet to be developed. The decision raises a number of questions related to the nature and specificities of this type of vehicle. It is expected that secondary legislation will provide clarity and define the necessary regulation so that such insurance can actually be concluded.
In any case, the risks associated with the ownership and use of these vehicles will increase the risk exposure of the Guarantee Fund. According to data from the Ministry of Interior, in recent years there has been a significant increase in incidents caused by such vehicles, including fatal cases. The latest figures for 2025 indicate 348 road traffic accidents involving individual electric vehicles, of which 265 were serious and 3 resulted in fatalities.
The transposition of the 6th Motor Insurance Directive is beneficial for society
The liability limits under MTPL insurance are being increased: up to EUR 6,450,000 for non-material and material damages resulting from bodily injury or death, regardless of the number of victims, and up to EUR 1,300,000 for material damage.
An important change is the introduction of an EU-harmonized mechanism for compensation in the event of license withdrawal or insolvency of an insurer. This will be done through a guarantee mechanism involving authorized compensation schemes in the Member States. This creates clear rules and predictability – something that had been lacking. Let us recall that the Bulgarian Guarantee Fund faced a serious challenge in the case of the bankrupt Cypriot company Olympic, which operated a branch in Bulgaria precisely due to the absence of harmonized rules. Victims began receiving compensation only after a favorable arbitration decision in our dispute with the Cypriot guarantee fund.
Going forward, if an insurer licensed by the Financial Supervision Commission becomes insolvent and offers MTPL insurance in another Member State, the compensation to victims in that country will be paid by the local compensation scheme. That scheme will then seek reimbursement from the Bulgarian Guarantee Fund. The same principle applies in reverse-if an insurer licensed in another Member State offers MTPL insurance in Bulgaria and becomes insolvent, the Bulgarian Guarantee Fund will pay compensation to the victims in Bulgaria and will recover the amounts from the compensation scheme in the insurer's home country.
Another change concerns contributions to the Guarantee Fund: they will now be calculated as a percentage of the gross written premium rather than as a fixed amount.
The scope of protection provided by the Guarantee Fund is also being expanded – in the event of a terrorist act committed using a vehicle on the territory of Bulgaria, the damage will be covered by the Fund.
The Guarantee Fund is fully prepared for the adoption of the euro as of 1 January 2026
All necessary updates to the Unified Information System in connection with the euro introduction have already been completed. The Guarantee Fund is fully prepared to switch to the new currency in the very first hours of 2026.