Who will pay for the damage after the new law enters into force?

From 2025 onwards, claims will be handled by both the Environmental Insurance Centre (YVK) and the Environmental Damage Fund. All damage caused after 31.12.2024 will be reported to the Environmental Damage Fund. After the entry into force of the new Act the YVK, in turn, will continue to deal with damages caused before 2025. Compensation for old damages can be applied for from the YVK for a further five years, i.e. until 31.12.2029. After that, a claim for compensation for damage caused before 2025 can still be made to the Environmental Damage Fund until 31.12.2034.

The YVK will complete all damage cases notified to it before the entry into force of the Act on the Environmental Damage Fund and those notified during the five-year transition period.

Responsibility for the environmental damage caused will continue to lie primarily with the party that caused the damage, which must also compensate for the costs of preventing environmental damage and restoring the polluted environment. Like the insurance system, the Environmental Damage Fund can be used to pay compensation for environmental damage when compensation cannot be recovered from the person who caused the damage or the person responsible is unknown. The Fund may also provide grants for procurement to combat environmental damage. The scope of compensation of the fund under the Ministry of the Environment is partly wider than in the current insurance system.

What should the policyholder do in the event of a change?

According to the Ministry of the Environment, the transition to the environmental damage fund system does not require any action from the operator. Environmental damage insurances will be terminated by 1.1.2025. In future, operators engaged in environmentally risky activities will have to pay either an annual or one-off environmental damage fee, depending on the risk the activity poses to the environment. The fee collection authority is the South Ostrobothnia Centre for Economic Development, Transport and the Environment.