Decision of the Board of Directors of the General Authority for Financial Supervision No. (36) of 2013 (Updated 2013) on Marketing Insurance Products Through Central Bank-Licensed Banks

Decision of the Board of Directors of the General Authority for Financial Supervision No. (36) of 2013 dated 2013/5/27 Regarding the Marketing of Insurance Company Products Through Banks Licensed by the Central Bank

According to the latest amendment dated 2013/6/18

1

Board of Directors of the General Authority for Financial Supervision

After reviewing the Law on Supervision and Control of Insurance issued by Law No. 10 of 1981 and its Executive Regulations, And Law No. 10 of 2009 on Regulating Supervision over Non-Banking Financial Markets, And the Basic Statute of the General Authority for Financial Supervision issued by Presidential Decree No. 192 of 2009, And the approval of the Authority's Board of Directors at its meeting held on 2013/5/27,

Has Decided

(Article One)
The following conditions are required to license an insurance company to market the Authority-approved standard insurance products through one of the banks licensed by the Central Bank of Egypt and registered in the record maintained by the Authority for this purpose:
-1 The company must have regularized its status in accordance with the provisions of Article (27) of the Law on Supervision and Control of Insurance issued by Law No. 10 of 1981 and its amendments.
-2 The company must have sufficient technical provisions to meet its obligations to policyholders, in accordance with the provisions of Article (37) of Law No. 10 of 1981, as reflected in the company's financial statements for the financial year preceding the license application, while observing the application of the provisions of Articles (25) and (26) of the Executive Regulations of the aforementioned Law. -3 No measures stipulated in the provisions of Article (59) of the aforementioned Egyptian Law on Supervision and Control of Insurance have been taken against it, unless the reasons for taking such measures have been removed and six months have elapsed since then.

(Article Two)
Insurance companies must adhere to the following controls and procedures as a minimum to conduct the activity of marketing standard insurance products through one of the banks licensed for this purpose by the Central Bank:
-1 Conduct a comprehensive study of the bank intended to be contracted with.
-2 Establish the necessary policies and procedures to address all risks associated with this activity.
-3 Obtain a letter issued by the Central Bank of Egypt confirming its approval for the bank to conduct this activity.
-4 Ensure that banking insurance customers are fully aware that the bank is merely a marketing channel and is not responsible for the terms and conditions of the insurance products being marketed, nor for paying any claims, and that responsibility for this lies solely with the insurance company. -5 Regarding the marketing of the company's insurance products through banks, the following must apply:
1/5 The insurance company must have a marketing unit within the bank's branches, comprising a sufficient team before commencing the activity.
2/5 The insurance company, through the aforementioned unit, must undertake the following tasks:

• Propose a work strategy in coordination with the bank to carry out promotional and marketing activities for its products through the bank's branches, along with the necessary procedures to supervise their implementation and evaluate them.
• Develop necessary plans in coordination with the bank for the continuous training of employees involved in the marketing of insurance products.
  3/5 The product team or brokers must meet the conditions for practicing insurance brokerage, such that they are registered with the General Authority for Financial Supervision in accordance with the foundations and conditions specified by Law No. 10 of 1981 and its amendments. 4/5 Product managers or brokers must receive adequate and continuous training to familiarize them with the insurance products to be promoted and how to market them.

1 The Decision was amended by the Authority's Board of Directors Decision No. 43 dated 2013/6/18.
2 Item (2) of Article One was replaced by the Authority's Board of Directors Decision No. 43 dated 2013/6/18.
3 Item (1/5) of Article Two was replaced by the Authority's Board of Directors Decision No. 43 dated 2013/6/18.

(Article Three)
In addition to any general provisions that may appear in contracts between the two parties, the contract signed between the insurance company and the bank must include, as a minimum, the following:
-1 The insurance products intended to be marketed through the bank's branches.
-2 The duties and obligations of both parties.
-3 The method of collecting premiums.
-4 The financial consideration due to the bank in the form of fees, commissions, and similar items, and the basis for calculating them.
4 Item (5) of Article Three was repealed by the Authority's Board of Directors Decision No. 43 dated 2013/6/18, and the remaining items of the Article were renumbered accordingly.
-5 Commitment to the confidentiality of accounts and information related to customers.
-6 Arrangements related to media campaigns.
-7 Mechanism for handling complaints received from customers.
-8 Mechanism for resolving disputes between the two parties.
-9 Persons authorized to sign, along with attached specimen signatures.
-10 Commitment by the bank to the controls issued by the Central Bank for conducting banking insurance activities.
5 Item (4) of Article Three was replaced by the Authority's Board of Directors Decision No. 43 dated 2013/6/18.

(Article Four)
Insurance companies wishing to conduct the activity of marketing their standard products through one of the banks licensed by the Central Bank must submit an application to the Authority to obtain its approval, accompanied by documents proving compliance with the controls and procedures stipulated in this Decision, prior to contracting with the bank, and in accordance with the controls issued by the Board of Directors of the Central Bank of Egypt.

(Article Five)
Insurance companies conducting the activity of marketing their standard products through one of the banks must regularize their status in accordance with the provisions of this Decision within a maximum period of three months from the date of its issuance.

(Article Six)
This Decision shall be published in the Egyptian Gazette and shall take effect from the day following the date of publication.