Insurance laws Russia
Russia's insurance sector is governed by a comprehensive legal and regulatory framework aimed at ensuring financial stability, consumer protection, and alignment with international standards.
๐ Key Legislation
Federal Law No. 4015-I (1992) โ On the Organisation of Insurance Business in the Russian Federation
This foundational law regulates the licensing, operation, and supervision of insurance and reinsurance companies in Russia. It establishes the legal framework for the insurance market, ensuring compliance with national standards and promoting market stability.
Federal Law No. 251-FZ (2018) โ On Amendments to the Law on Insurance Organisations
This law introduced significant reforms to the insurance sector, including changes to licensing procedures, capital requirements, and supervisory measures, to enhance market transparency and consumer protection.
Federal Law No. 236-FZ (2022) โ On the Pension and Social Insurance Fund of the Russian Federation
Enacted in July 2022, this law reorganised the Pension Fund and the Social Insurance Fund into a single entity, effective from January 2023, to streamline social insurance processes.
๐๏ธ Regulatory Authority
The Bank of Russia (Central Bank of Russia) is the primary regulatory body overseeing the insurance and reinsurance sectors. Its responsibilities includ:
๎Licensing and supervising insurance and reinsurance companie.๎๎
Ensuring compliance with capital, solvency, and reserve requirement.
Implementing corporate governance standard.
Protecting consumer interests and promoting market transparenc. The Bank of Russia's Insurance Market Department develops regulations, considers draft laws, and supervises compliance with insurance legislatio.
๐ฐ Capital and Solvency Requirement
Under current legislation, the minimum charter capital for insurers s:
*Property and business risk insurers: 240 million rubes
*Life insurers: 380 million rubes
*Reinsurers: 560 million rubes
These requirements are set to increase in 2024; hwever, a recent bill has been proposed to make the current levels permanet.
The Bank of Russia's Regulation No. 781-P outlines requirements for insurers' financial stability and solvency, focusing on early identification of issues and protection of policyholders' interess.
๐ก๏ธ Consumer Protectin
Russia's insurance laws prioritize consumer rights throgh:
Mandatory clear and comprehensive policy disclosues.
Regulations against unfair practices, including misleading advertising and discriminatory tems.
Establishment of alternative dispute resolution mechanisms to address consumer grievances efficienly.
๐ Market Developments
Regulatory Easing Measure: In response to market challenges, the Bank of Russia introduced temporary regulatory easing measures, such as extending deadlines for overdue payments and adjusting capital buffer requirements. These measures were partially cancelled in late 2023 as market conditions stabilsed.
Foreign Investmen: Federal Law No. 267-FZ (2012) increased the permissible share of foreign capital in insurance organisations from 25% to 50%, aiming to improve the investment climate for foreign investors in the Russian insurance setor.
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