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Report: Argentine insurers threaten legal action over central bank norm

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Report: Argentine insurers threaten legal action over central bank norm

Argentineinsurers have threatened legal action over a new Banco Central de la República Argentina norm that allowsbanks to sidestep insurers and offer certain insurance products directly to clients,La Nación reported April 13.

Accordingto the norm, as of September banks will be able to offer life and disability coverageto clients with debts.

The aimis to increase competition between banks since they will have to include the costof the insurance policy in the interest rate offered to clients instead of chargingseparately, which will allow clients to compare prices more easily.

But insurershave reportedly questioned the norm's legal basis, arguing that the central bankdoes not have the power to define insurance norms, and have threatened to go tocourt.

Theysay the norm will mean that banks will not offer loans to the elderly or the sickand it will result in lost jobs in the insurance business.

Insuranceassociations have requested an urgent meeting with officials at the central bankand the insurance regulator, but as of April 12 had not received a reply, the reportsaid.

Centralbank officials reportedly declined to comment.