Chairman's Decision No. 292 of 2023 Amending Decision No. 902 of 2016 on Microinsurance Definition and Electronic Issuance Regulations

Egyptian Financial Regulatory Authority
Chairman's Decision No. 292 of 2023
Dated: January 31, 2023
Amending Decision No. 902 of 2016 regarding the definition of Microinsurance and the executive regulations for its electronic issuance and distribution through the information systems network.

The Chairman of the Egyptian Financial Regulatory Authority, Having reviewed Law No. 10 of 1981 concerning supervision and control over insurance in Egypt, its executive regulations, and amendments; Law No. 15 of 2004 concerning the regulation of electronic signatures in Egypt; Law No. 10 of 2009 concerning the regulation of supervision over non-banking financial markets and instruments; Law No. 5 of 2022 issuing the law regulating and developing the use of financial technology in non-banking financial activities; Presidential Decree No. 192 of 2009 issuing the Basic System for the Egyptian Financial Regulatory Authority; Board Decision No. 122 of 2015 concerning the regulation of issuance and distribution by insurance companies of certain standard insurance policies electronically through the information systems network, and its amendments; FRA Decision No. 729 of 2016 concerning technological regulations and information security rules related to the electronic issuance and distribution by insurance companies of certain standard policies through the information systems network; FRA Decision No. 730 of 2016 concerning executive regulations for standard insurance policies that can be issued and distributed electronically through information networks, and its amendments; FRA Chairman's Decision No. 902 of 2016 concerning the definition of Microinsurance and executive regulations for its electronic issuance and distribution through the information systems network, and its amendments; And the memorandum prepared by the Central Administration for Insurance Product Approval in this regard;

DECIDES:
(Article One) A new clause is added to Paragraph 1 of Article Five of the aforementioned Chairman's Decision No. 902 of 2016, reading as follows:
(Article Five / Paragraph 1):
(h) Telecommunications companies and electronic stores licensed to operate by competent authorities and approved by the Authority.

(Article Two) This Decision shall be published in Al-Waqaei Al-Masriya and on the Authority's electronic website, and shall be effective from the day following its publication in Al-Waqaei Al-Masriya. Chairman of the Board of Directors, Egyptian Financial Regulatory Authority Dr. Mohamed Fared Saleh

(1) Telecommunications Company: Refers to the company that provides wired or wireless telecommunication services and data transfer to its customers electronically, and is licensed by the relevant authorities. Electronic Store: Refers to the website or electronic platform on the international "Internet" information network, which displays various products (goods and services), includes lists of displayed goods and services with their basic information, and provides a complete set of operations including distribution, marketing, sales, and electronic payment for various products, and is licensed by the relevant authorities.

Decision No. (902) of 2016 dated: 2016/11/2
Regarding the definition of Microinsurance through the information systems network and executive regulations for its electronic issuance and distribution.
Last amended by Chairman's Decision No. 292 dated 2023/1/31.

The Chairman of the Egyptian Financial Regulatory Authority, Having reviewed Law No. 10 of 1981 issuing the law concerning supervision and control over insurance in Egypt, its executive regulations with amendments; Law No. 15 of 2004 concerning the regulation of electronic signatures; Law No. 10 of 2009 concerning the regulation of supervision over markets and non-banking financial instruments; Law No. 141 of 2014 concerning the regulation of financial technology activities; The Basic System for the Authority issued by Presidential Decree No. 192 of 2009; Board Decision No. (122) of 2015 concerning the regulation of issuance and distribution by insurance companies of certain standard policies electronically through information systems networks, with its amendments; Chairman's Decision No. (729) of 2016 concerning technological regulations and information security rules related to the electronic issuance and distribution by insurance companies of certain standard policies through information systems networks; Chairman's Decision No. (730) of 2016 concerning executive regulations for standard insurance policies that can be issued and distributed electronically through information networks; DECIDES:

(Article One) Definition of Microinsurance
Microinsurance is defined as any insurance service targeting individuals with low income, covering risks they can afford, where the premium does not exceed one-third of the maximum limit of the insurance policy. This definition applies to all branches specified in Article Two of this Decision, and the premium does not exceed 1/3 of the maximum limit of the insurance policy.

(Article Two) Microinsurance Branches:
First, Personal Microinsurance Policies - in the following branches:
(a) Health insurance of all types.
(b) Long-term Personal Accident insurance.

Second, Property and Liability Microinsurance Policies - in all branches except:
(a) Family Motor insurance with related liability.
(b) Fire insurance.
(c) Marine insurance with related liability (subject to specific distribution conditions for the Gulf region, equivalent to the maximum limit for non-banking insurance policies). (d) Aviation and Air risks with related liability. (e) Ship insurance with related liability (subject to specific conditions equivalent to the maximum limit for non-banking insurance policies).

(Article Three) Conditions and Requirements for Approving Microinsurance Policies First: The "Use & File" approval system is followed for non-banking insurance policies with the Authority, after determining their types and approving them individually by the Authority for each type, based on actuarial principles that reduce insurance costs if the policies are of the health branch. Second: The following mandatory data must be included in printed microinsurance policies:

• Policy number, clearly linked to the policy.
• Insured's name and nationality.
• Coverage type and amount.
• Coverage limit.
• Limits with specific conditions (subject to the maximum limit for non-banking insurance).
• Required claims submission deadlines.
• Insurance premium.
• Claim payment deadline, in the currency specified in the policy.
• Notification period for the insurer upon loss occurrence, not exceeding one week from the date of loss.
• Claim submission period, not exceeding 10 working days from the date of submitting required documents.
• Payment deadline for the insurer.
• Distribution channels specified per policy type, considering customer contact ease during premium collection.
• Policy validity period without requiring renewal.
  The insurer must take necessary measures to protect electronic microinsurance policies from damage (e.g., fire, theft). Electronic microinsurance policies may not be issued until fully compliant with the conditions of this Decision.

(Article Four) Electronic Issuance and Distribution of Microinsurance Policies Insurance companies holding the Authority's approval may issue microinsurance policies electronically through customer information systems, following the policy and distribution procedures by authorized entities specified in Article Five of this Decision, subject to the conditions stipulated in this Decision and Decision No. 122 of 2015.

(Article Five) Contracting Parties and Conditions Microinsurance policies may be issued and distributed electronically through information systems by the following entities:
(a) Health insurance companies.
(b) Financial service companies licensed under Law No. 141 of 2014.
(c) Associations with relevant institutions licensed under Law No. 141 of 2014 (excluding insurance companies).
(d) Banks registered with the Central Bank of Egypt.
(e) Agricultural credit banks affiliated with commercial banks.
(f) Individuals.
(g) Associations with relevant institutions at other entities approved by the Authority.
(h) Telecommunications and electronic stores licensed to operate by competent authorities, approved by the Authority.
Prior approval of the Authority is required for the agreement between the insurer and the distribution entity, which must include a minimum of the following terms:

1. The insurer's commitment to bear costs related to premium collection, claims processing, and compensation payment to the insured.
2. The insurer's commitment to maintain data integrity for customers at all times.
3. Specification of distribution responsibilities per policy type and product category.

(Article Six) Electronic Microinsurance Policy In addition to the data specified in Article One, electronic microinsurance policies must comply with the following conditions:

1. The policy must clearly state that coverage is provided upon premium payment through a financial institution deposited with the Authority, distributed by insurance companies.
2. The printed copy of the policy must display a QR/barcode linking to the electronic website, allowing data entry and reducing reliance on insurance company employees for distribution, marketing, and compensation payment. The insurer bears responsibility for policies distributed through it.
3. The printed copy must display the policy number and date upon issuance by the service provider.
4. The printed copy must display a QR/barcode linking to the electronic website, allowing data entry and providing complete information for distribution customers via their computers/mobile devices, including phone numbers and specified email addresses.
5. The policy must be valid without requiring renewal, subject to the insurer taking necessary measures to protect electronic microinsurance policies from damage (fire, theft, etc.). Electronic microinsurance policies may not be issued until fully compliant with the conditions of this Decision.

(Article Seven) Customer Handling and Retained Documents Insurance companies must take specific measures to receive applications for microinsurance policies, study them, and complete processing within the period specified in Article One of this Decision. Customers must maintain separate claim files categorized into fixed claims, pending claims, and rejected claims, including:

1. A copy of the policy.
2. The customer's application.
3. Actuarial calculations with supporting documents, if any, to prove claims and specify the maximum amount leading to loss.
4. All receipts for premium payment (or final settlement).
5. Decisions taken by the insurer regarding claims, dated.
6. Claim forms signed by the customer, specifying that the insurer will pay compensation upon loss according to legal principles.
   Claims for covered periods must be settled within the specified policy period.

(Article Eight) Periodic Reports
Insurance companies must submit quarterly reports on microinsurance operations to the Egyptian Financial Regulatory Authority within forty (40) days of each quarter-end, including:

1. Insurer name.
2. Coverage type.
3. Insurance branch (Health/Property).
4. Number of policies (new/renewed).
5. Premiums.
6. Installments (paid/pending).
7. Operational status (management/companies, etc.).
8. Payments made.
9. Claims.

(Article Nine) Training of Authorized Personnel for Electronic Issuance and Distribution Insurance companies are responsible for training distribution staff at electronic entities on operational procedures for microinsurance policies, ensuring they receive necessary information to fulfill customer requirements, enhance sales, and increase revenue.

(Article Ten)
This Decision shall be published in Al-Waqaei Al-Masriya and on the Authority's electronic website, effective from the day following its publication date. It shall be communicated to relevant departments.