Minister of Investment Decision No. 216 of 2007 Regarding the Conditions and Premium Rates of Insurance at the Government Insurance Fund for Custodians' Guarantees

Egyptian Documents - No. 185 dated 14 August 2007

Ministry of Investment Decision No. 216 of 2007 Regarding the Conditions and Premium Rates of Insurance at the Government Insurance Fund for Custodians' Guarantees

Minister of Investment

Having reviewed Law No. 10 of 1981 issuing the Law on Supervision and Control of Insurance in Egypt and its executive regulations; and Decision No. 282 of 2006 of the President of the Republic issuing the bylaws of the Government Insurance Fund for Custodians' Guarantees; and Decision No. 400 of 1986 of the Minister of Economy and Foreign Trade regarding the conditions and premium rates of government insurance for custodians' guarantees; and the letter from the Egyptian Insurance Authority dated 25/6/2007:

It is decided:

(Article One)

The insurance amount at the Government Insurance Fund for Custodians' Guarantees shall be equivalent to the following:

(a) (100%) of the value of the guarantee if it consists of cash, stamp paper, or valuable stamps, based on the maximum amount that may at any time be in the custody of the custodian during the insurance period.

(b) (100%) of the value of the guarantee if it consists of valuables or tools, based on the latest inventory.

(c) The value of motorcycles and cars shall be fully insured according to the latest inventory, subject to the maximum guarantee limit.

The insurance amount shall be determined in multiples of one hundred pounds, and in no case shall it be less than two hundred pounds. It shall not exceed one hundred thousand pounds, regardless of the guarantee's value.

(Article Two)

The insurance period shall cover a full financial year. The insurance premium rate per one hundred pounds shall be determined as follows:

(a) Six piastres per year for the first ten thousand pounds. (b) Twelve piastres per year for the amount exceeding the first ten thousand pounds up to fifty thousand pounds. (c) Twenty-four piastres per year for the amount exceeding fifty thousand pounds.

Under no circumstances shall the minimum insurance premium be less than one pound. Nor shall it exceed one hundred and seventy-four pounds. The amount deducted from the custodian's salary or wages for the insurance premium shall not exceed (0.5%) of their basic salary during the insurance period. If the premium exceeds this percentage, the employer of the custodian shall bear the difference.

(Article Three)

In the event a new guarantee is assigned or an existing guarantee is increased to an employee during the financial year, insurance shall apply from the date of assignment until the end of the financial year. The premium amount shall be determined by multiplying the annual premium by the proportion of the financial year during which the insurance is in effect. This premium shall be deducted in advance and paid to the Fund at the beginning of the insurance period.

(Article Four)

If a single guarantee is held by more than one custodian, insurance shall be applied individually for each custodian for the entire guarantee in accordance with the provisions of this Decision. If a custodian is entrusted with more than one guarantee, insurance shall be applied to the value of each guarantee individually, such that the insurance amount for each guarantee does not exceed 100,000 pounds regardless of its type, and such that the amount deducted from the custodian's salary for insurance premiums does not exceed (0.5%) of their basic salary.

(Article Five)

The Fund's liability shall commence from the date of issuing the cheque for the insurance premium amount, even if the insurance period started prior to this date.

(Article Six)

The Fund shall compensate for the shortfall in an insured guarantee, regardless of any damages, losses, administrative expenses, shortfall valuation differences, or late payment interest resulting therefrom, subject to the following conditions:

(a) The shortfall must result from negligence, fraud, misappropriation, or embezzlement committed by the custodian during the insurance period. (b) The employer of the custodian shall notify the Fund of the shortfall immediately upon its discovery, without waiting for the conclusion of criminal or disciplinary proceedings against the custodian, accompanied by the following data and documents:

1. An official copy of the prosecutor's investigation or court judgment establishing the custodian's liability, or the administrative decision signed, stamped, and certified.
2. Documents indicating the shortfall value, its occurrence date, and discovery date, along with the inspection committee's report.
3. Latest inventory forms confirming the guarantee's integrity prior to the discovery of the shortfall.
4. Any amount recovered from the liable custodian towards the shortfall value.
5. A copy of the Fund-approved guarantee form including the name of the employer responsible for the period in which the shortfall occurred, as well as the date, number, and amount of the cheque paid covering the insurance premium for this period.

(c) The claimed compensation amount shall not be less than 200 pounds nor exceed 100,000 pounds. (d) The compensation value shall not exceed the insurance amount.

(Article Seven)

The employer of the custodian shall forfeit the right to claim compensation from the Fund in the following cases:

1. Failure to discover the shortfall within three months following the custodian's death, resignation, or transfer of the guarantee to another custodian.
2. Expiration of one month from the date of discovering the shortfall without notifying the Fund.
3. Expiration of two years from the date of discovering the shortfall without submitting the required data and documents.

Stipulated in paragraph (b) of Article (7) The Chairman of the Board of Directors of the Egyptian Insurance Authority or their delegate may grant an extension for delays in the aforementioned time limits due to reasons beyond the control of the said employer.

(Article Eight)

The Fund shall not be liable to compensate for any shortfall occurring in a guarantee held by a custodian for whom the Fund has previously compensated a shortfall.

(Article Nine)

Decision No. 400 of 1986 of the Minister of Economy and Foreign Trade, and any provision conflicting with the provisions of this Decision, are hereby repealed.

(Article Ten)

This Decision shall be published in the Egyptian Gazette and shall take effect from the day following its publication date.

Issued on 6/8/2007

Minister of Investment Dr. Mahmoud Mohieldin