Regulatory Alerts2022-04-06
Added · Updated
Circular on Collecting the Annual Fee from Insurance Companies
The Central Bank of Jordan mandates that insurance companies pay an annual fee calculated at a rate of 4.5 per thousand on total premiums subject to the fee. The fee base is determined by aggregating direct and reinsurance premiums, deducting reinsurance received from local insurers, and adding contract issuance service fees. Companies must remit the fee to the Central Bank every six months within 30 days of the period's end, accompanied by an external auditor-signed statement. This Circular, effective April 3, 2022, repeals Decision No. (9) of 2014 regarding annual fee collection.
In the Name of Allah, the Most Gracious, the Most Merciful
[Logo of the Central Bank of Jordan]
Number: 17 / 5848 Date: 7 Ramadan / 1443 AH Corresponding to: 4 / 4 / 2022 AD
Dear Insurance Companies,
Subject: Circular on Collecting the Annual Fee from Insurance Companies
Based on the provisions of Article (3) of the Insurance Activities Fees Law No. (18) of 2022, I hereby decide the following:
1- The total premiums subject to the annual fee shall be calculated at a rate of (4.5) per thousand, which is recorded in Field No. (4) of the table attached to this Circular, as follows:
a- The following premiums are aggregated and recorded in Field No. (1) of the table attached to this Circular:
- Direct insurance premiums written by the company within and outside the Kingdom.
- Reinsurance premiums received by the company.
b- From the total premiums resulting from paragraph (a) of this item, reinsurance premiums received by the company from a local insurance company shall be deducted, and these premiums shall be recorded in Field No. (2) of the table attached to this Circular.
c- The value of the insurance contract issuance service fee shall be added to the total resulting from paragraphs (a) and (b) of this item, and shall be recorded in Field No. (3) of the table attached to this Circular.
2- The company shall pay the annual fee due to the Central Bank, which is recorded in Field No. (5) of the attached table, for every six months within (30) days starting from the day following the end of this period. The payment shall be deposited directly into the supervision and monitoring fees account for insurance companies.
3- The company shall notify the Central Bank after each deposit made regarding the annual fee and attach to this notification a statement showing the premiums subject to the fee and the amount of the fee due, in accordance with the table attached to this Circular. The statement must be reviewed by the company's external auditor and signed to confirm this before submission to the Central Bank.
4- Decision No. (9) of 2014 "Decision on Collecting the Annual Fee from Insurance Companies" and its amendments are hereby repealed.
5- The provisions of this Circular shall be effective as of the date 2022/4/3.
Governor Dr. Adel Al-Sharkas [Signature]
P.O. Box 37, Amman 11118, Jordan • Tel: 4630301 • Fax: 4638889, 4639730, 461330 e-mail: info@cbj.gov.jo website: www.cbj.gov.jo
[Logo of the Central Bank of Jordan]
Premiums Statement for Insurance Companies and Total Premiums Subject to the Annual Fee Due to the Central Bank
For the company .................................... for the period ....................................
| Field No. 1 | Field No. 2 | Field No. 3 | Field No. 4 | Field No. 5 |
|---|---|---|---|---|
| Total premiums written locally and internationally | Reinsurance premiums received by the company from a local insurance company | Insurance contract issuance service fee | Total premiums subject to the fee (1)-(2)+(3) | Amount of the fee due to the Central Bank at a rate of 4.5 per thousand |