Law on Independent Appraisers needs urgent changes

Ms. Bozhilova, please say a few words about the upcoming seminar with special participation of international speakers on the topic: Responsibility of evaluators and risk management in evaluation. 

The seminar is organized by the Chamber of Professional Appraisers in Bulgaria on September 30, and its purpose is to emphasize a very important question that is often overlooked by practicing appraisers: what is the risk in the appraisal profession, can I manage it and if so - What should I know. The keynote speaker will be Prof. Anthony Lavers, with extensive legal experience in the field in the UK, but not to be underestimated the other participants, followed by Mr. George Badescu - founder and first President of the Chamber of Appraisers in Romania (for 10 years) and is currently a member of the International Committee on Valuation Standards; Ms. Dana Ababey - President of the Chamber of Appraisers in Romania in the period 2017 - 2019 and an active participant in seminars and meetings on appraisal topics in Europe and within the International Committee on Appraisal Standards. On the Bulgarian side, a kind of host and moderator will be Ms. Diana Nikolaeva - a partner in E&Y Bulgaria and first chairman of the Chamber of Professional Appraisers, which is currently a member of the International Committee on Appraisal Standards in the section of business appraisal. We are pleased to receive the support of the insurance broker NET INS. Your branch association is the organizer of the event. 

Introduce the Chamber, its purpose and its members. How many professional evaluators are there in Bulgaria? 

The Chamber of Professional Appraisers (CPA) is a non-profit organization working in the public interest and based on the principles: expertise, experience, honesty and integrity. Currently, 15 legal entities and 46 individuals are members of KPO. Our members represent the largest appraisal and consulting companies in Bulgaria, which have a long tradition and a high level of professionalism. Our members are also proven professionals - individuals. Thus, more than 300 appraisers are involved in the professional circle of KPO, providing over 75% of the appraisal services in the country. 

One of the topics of discussion is professional liability insurance, what is the current legal framework - mandatory or voluntary, group or individual, what does it cover, how is insurance regulated in EU countries? 

According to the current Law on Independent Appraisers, Professional Liability Insurance is mandatory. The texts are as follows: Art. 18. The independent evaluator is obliged to: ……. 7. be insured for the risks from his professional activity; ……. Art. 19. (1) The independent appraiser shall bear property responsibility for damages, which he has caused to the assignor, if they are direct and immediate consequence of his guilty actions. (2) The responsibility under par. 1 shall be carried out in accordance with the Law on Obligations and Contracts under the General Claim Procedure. Each country has its own rules for the activities of independent appraisers, but in addition to local, there are rules and requirements for insurance at the international level. For example, the Royal Institution of Chartered Surveyors (RICS), the world's largest professional organization in the field with more than 150 years of history, publishes requirements and general guidelines for its members on what professional indemnity insurance should cover and on what basis it can be concluded. No serious professional appraiser imagines that he will practice such a responsible profession today without insurance. The point is for this insurance to serve as a real guarantee that in the event of an event covered by the policy, the insurer will support it financially. 

How many insurance events under this policy are registered on an annual basis? Do you have information on what benefits are paid on average? 

As far as I know, there are no events for which compensation has been sought and paid by an insurer. However, this does not relieve us of the need to know the risks and how to manage them. It is also important to create conditions for the professional liability insurance of appraisers, which covers specific risks and reflects the real needs of the profession, and not to be done formally just because someone requires it to be indicated in the annual report of the appraiser. According to the Law on Independent Appraisers, appraisal activity is performed both by appraisers - individuals and by companies of independent appraisers.