The activities of insurance and reinsurance carried out on the Romanian territory are mainly regulated by the provisions of Law no. 136/1995 regarding insurance and reinsurance, as subsequently amended, as well as Law no. 32/2000 regarding companies for the insurance and monitoring of insurance, as amended.

The National Commission for the Monitoring of Insurance (CNSA) is the autonomous administrative authority with duties of monitoring and control in the insurance field. In exercising the duties that are incumbent upon it, the CNSA monitors the financial condition of the insurers, it controls the insurers' compliance with prudent norms and approves the insurer's significant shareholders and significant persons. With regard to the authorization, suspension or with drawl of the authorization of an insurer, the CNSA issues decisions, and releases notices to formulate official responses with implications upon insurance activity.

- the paid-in share capital, or in case of a mutual company, the paid-in free reserve fund;

- the solvency margin, which represents the variation between the value of the assets and the value of the obligations, and must be higher than the value set under the law.

The paid-in share capital or the paid-in free reserve fund, as the case may be, may not be lower than:

- ROL 7 billion for the activity of general insurance, with the exception of mandatory insurance;

- ROL 14 billion for the activity of general insurance;

- ROL 10 billion for the activity of life insurance;

- a sum of the above-mentioned values, as the case may be, depending on the insurance activities carried out.

The paid-in share capital and the paid-in free reserve fund are periodically upgraded by the CNSA through norms.

The paid in share capital or the paid in free reserve fund, as the same are provided for under the law, must be fully paid in cash, only upon establishment.

In Romania, insurance activity is carried out in the form of facultative and mandatory insurance, as well as reinsurance operations.

According to the provisions of the law, third-party liability for accidents caused by motor vehicles is the only mandatory insurance, and the conclusion of other types of insurance is voluntary.

Between mandatory insurance and voluntary insurance there are significant differences with respect to the applicable legal regime.

With mandatory insurance, the relations between the insured and the insurer are set out by means of Law no. 136/1995. Mandatory insurance is only practiced by insurers that are authorized by the CNSA to carry out such insurance activities.

The rights and obligations of the parties, as well as the legal regime of voluntary insurance are set forth in the insurance contract. Voluntary insurance contracts may cover risks regarding goods, persons and prejudices resulting from the third party liability of the insured.

Through reinsurance activity, the insurer may become a reinsurer or a reinsured, by receiving reinsurance premiums, in exchange for which it bears part of the insured risk in case that such risk event occurs or by yielding in its capacity as insured, reinsurance premiums in exchange for which the reinsurer shall bear part of the insured risk.