Resolution from the MNB on legal issues regarding the TCI Decree 6 October 2018
The MNB has adopted a resolution on the interpretation of certain provisions of the MNB Decree No. 55/2015 (XII.22.) on the calculation and publishing the Total Cost Indicator (TCI), a tool used to compare cost burden of different life insurance plans.
MNB ruled that the costs arising from the performance fees to be paid by the underlying investment funds, reducing the net asset value thereof, shall be taken into account when calculating the TCI despite the fact that according to the Regulation 583/2010/EU only the so-called ongoing charges shall be taken into account, which
Another question concerned the riskfree rate of return to be used when calculating
Finally, MNB has answered the question whether TCI may apply to special life insurance products, such as death risk policies with an experience refund, or with savings element, where a minor amount is returned to the policyholder at the end of the term of the death risk policy. MNB found that since these kinds of policies either hold surrender value or provide insurance amount, they fall under the scope of the TCI Decree and a TCI value shall be calculated for these policies as well as for other life insurance policies with savings elements.Back to news