# Research article: the cooperative as a form of insurer (2018)

URL: https://insurancelawestonia.ee/blog/2018-07-01-research-cooperative-mutual-insurer/
Author: Dr Olavi-Jüri Luik, Partner, Head of Insurance Law, attorney at law (Advokaadibüroo WIDEN OÜ)

> Luik and Urm, Juridica 2018/7: mutual insurance and the 2018 bill allowing Estonian insurers to operate as cooperatives, in force since 2019.

> **Article (in Estonian):** O.-J. Luik, A. Urm, "Tulundusühistu kui kindlustusandja tegutsemise vorm" (The commercial cooperative as a legal form of insurer), Juridica 2018/7, pp. 478–488. [Article page on Juridica](https://www.juridica.ee/article.php?uri=2018_7_tulundus_histu_kui_kindlustusandja_tegutsemise_vorm) (published 2018)

Co-author: Alar Urm.

## Research question

Estonia was one of few EU countries where policyholders could not buy cover from a mutual insurer, although mutual insurance was common in Estonia before 1940. In August 2018 the Ministry of Finance circulated a bill amending the Insurance Activities Act and the Law of Obligations Act to allow insurers to operate as cooperatives. The article asks what mutual insurance is and whether the proposed change would be enough for insurance cooperatives to emerge.

## Content

The authors analyse the nature, history and European practice of mutual insurance and the solutions in the bill. The abstract does not state the final conclusions, so they are not repeated here.

## What has changed

The bill became law. Under § 11(1) of the Insurance Activities Act (kindlustustegevuse seadus, KindlTS), since 2 March 2019 an Estonian insurer may operate as a public limited company, a European company, a commercial cooperative or a European cooperative society (RT I, 20.02.2019, 2), with specific rules for insurance cooperatives in § 11¹ ([Riigi Teataja](https://www.riigiteataja.ee/akt/KindlTS)). Where membership is required, policyholders must be informed before the contract is concluded.

## Related pages

- [History of insurance: Estonia before 1940](https://insurancelawestonia.ee/history-of-insurance/estonia-before-1940)
- [Regulatory and distribution services](https://insurancelawestonia.ee/services-for-insurers/regulatory-and-distribution)