Pawnshops’ unfair insurance practice: regulator’s opinion

Pursuant to law, a pawnshop should, at its own expense and to the benefit of a consumer, insure an item it accepts in pledge or storage against the risk of its loss or damage in the amount equalling its assessed value and for the entire period during which this property is kept in the pawnshop.

The Bank of Russia has revealed cases where pawnshops insured property solely as of a specific date. According to the regulator, this is an unfair practice because accepted property should be insured regardless of the time when pawnshops transfer reports, property lists, or other documents to insurers.