Decision No. (902) of 2016 Concerning the Definition of Microinsurance via Information Systems Networks and Executive Controls for Issuing and Distributing Electronic Documents

Decision No. (902) of 2016 dated: 2016/11/2 Concerning the definition of microinsurance through information systems networks and the executive controls for issuing and distributing its electronic documents Last amended by the Chairman's Decision No. 80 dated 2024/1/14

Chairman of the General Authority for Financial Supervision

Having reviewed Law No. 10 of 1981 on the issuance of the Life Insurance Law and its amendments; Having reviewed Law No. 15 of 2004 on regulating electronic practice; Having reviewed Law No. 10 of 2009 on regulating dealing in financial instruments; Having reviewed Law No. 141 of 2014 on regulating the microfinance activity; Having reviewed the General Authority for Financial Supervision's Basic System by Presidential Decree No. 192 of 2009; Having reviewed the Authority's Board of Directors Decision No. (122) of 2015 on regulating the issuance and distribution of insurance documents for some electronic insurance documents through information systems networks, as amended; Having reviewed the Authority's Chairman Decision No. (729) of 2016 on electronic controls for information design rules related to issuing and distributing insurance documents for some electronic insurance documents through information systems networks; Having reviewed the Authority's Chairman Decision No. (730) of 2016 on electronic controls for insurance documents to be issued and distributed electronically through information systems networks;

Has decided:

(Article 1) Definition of Microinsurance Microinsurance is defined as any service aimed at providing low-income individuals with access to insurance products for their assets or risks that may cause them financial hardship, where the premium does not exceed the amount specified in Article Two of this Decision. In all cases, the maximum value of the policy shall not exceed forty thousand Egyptian pounds.

(Article 2) Branches of Microinsurance First, Microinsurance documents – Individuals, in the following branches: a. Protection insurance in all its types. b. Personal accident insurance for long-term insurance. c. [Amendment Note: The Decision was amended by the Chairman's Decision No. 2143 dated 2021/12/9, Decision No. 292 dated 2023/1/31, Decision No. 1289 dated 2023/5/25, and Decision No. 80 dated 2024/1/14.]

Second, Microinsurance documents – Property and liabilities, in all branches except: a. Insurance on land transport vehicles, their equipment, and associated liabilities. b. Construction insurance. c. Insurance on ships and associated liabilities (excluding specific cases for distribution channels that do not meet the minimum threshold for general insurance policy values). d. Marine, aviation, and air risks insurance and associated liabilities. e. Insurance on maritime transport vehicles, their equipment, and associated liabilities (excluding cases that do not meet the minimum threshold for general insurance policy values).

(Article 3) Conditions and Requirements for Approving Microinsurance Documents First: The "Use & File" approval system shall be followed for microinsurance documents with the Authority, and all their types shall be approved by the Authority for each type, subject to the approval conditions minimizing the use of actuarial bases in calculating policy prices if the policy is one of the life insurance types. Second: Microinsurance documents must contain the following data:

• Policy number, along with all related policy numbers.
• Policyholder's name and nationality.
• Type and description of the coverage.
• Coverage period.
• Special clauses (excluding those deviating from standard insurance principles).
• Required documents upon claim.
• Insurance. The earliest date for policy cancellation or any request.
• Insurance premium, in installments, in the currencies specified in the policy.
• A clause on the time limit for notifying the insurer of the loss, not exceeding seven days from the date of the loss.
• A clause on the time limit for submitting the claim, not exceeding 10 working days from the date of providing required documents.
• A clause on the time limit for the insurer to pay the compensation.
• A clause on the policyholder's obligation to be notified in advance for each insurance type, allowing a grace period for payment if contact is lost during premium collection. It is noted that the policy must include a clause stating that recourse to arbitration is not permitted unless agreed upon to a higher degree.

(Article 4) Electronic Issuance and Distribution of Microinsurance Documents Insurance companies holding the Authority's license to issue microinsurance documents electronically through customer information systems must make the policy printable and distributable through one of the entities listed in Article Five of this Decision, subject to compliance with the controls specified in this Decision and Decision No. (122) of 2015.

(Article 5) Authorized Entities for Electronic Issuance and Distribution of Microinsurance Documents Microinsurance documents shall be issued and distributed electronically through information systems networks via one of the following entities: a. Insurance and life insurance agents. b. Companies holding a valid license for microfinance activities under the provisions of Law No. 141 of 2014. c. Cooperatives and primary institutions holding a valid license for microinsurance activities under the provisions of Law No. 141 of 2014 (excluding banks). d. Banks registered with the Central Bank after obtaining its approval. e. Microfinance banks and agricultural credit banks. f. The National Post. g. Cooperatives and primary institutions and other entities approved by the Authority. h. Telecommunications companies and electronic stores licensed for electronic commerce with the entities under the Authority's supervision. The Authority's prior approval shall be required for the agreement contract between the insurance company and the distributing entity, which must include the following minimum data:

1. Contractual commitments for each party regarding their responsibilities for premium collection, claim submission, and compensation payment to the policyholder.
2. The contracting party's commitment to maintaining the integrity of data and information related to customers at all times.
3. The contract must specify the responsibilities of the distribution entity for each type and category of insurance documents.

(Article 6) Microinsurance Document Issued and Distributed Electronically In addition to the data specified in Article Three, the following controls must be applied to the microinsurance document issued by the electronic distributor:

1. The policy must state that the insurance coverage is valid upon payment of the premium through the customer's account via an electronic transfer or deposit of funds into the account of the entity authorized by the Authority to distribute microinsurance documents issued electronically by the insurance company.
2. The printed copy of the policy must include a notice and a link to the electronic website for entering policy data upon printing, clarifying the insurer's liability between the distributing entity and the insurer, except for marketing and distribution purposes, with responsibility for compensation payment falling on the contracting insurance company itself.
3. The printed copy of the policy must include a notice with the policy number, date, and time of printing, and the name of the entity providing the printing service.
4. The printed copy of the policy must include a notice and a link to the electronic website for entering policy data upon printing, containing complete information for customers and customer service centers of the insurance company for electronic distribution of insurance documents, to enable customers to receive their copies. This information must include phone numbers and designated email addresses for customer service centers mentioned.
5. The policy must be issued in a format that does not require the policyholder's signature/seal. Insurance companies must take necessary measures to protect electronically issued microinsurance documents from forgery or alteration (e.g., watermarks, prominent signs, etc.). Microinsurance documents issued electronically shall not be issued unless they fully comply with the controls regulating this matter.

(Article 7) Controls for Dealing with Customers and Retained Documents Insurance companies must set specific controls for receiving and studying microinsurance customer applications, completing them within the period specified in Article Three of this Decision. Customers must also maintain dedicated claim files, categorized into settled claims, claims under review, and rejected claims, each including the following:

1. A copy of the insurance policy.
2. The customer's application.
3. A report from the relevant expert providing information, if available, regarding each file with any supporting evidence for the claim, and specifying the approximate amount that led to the loss.
4. A receipt for premium payment (or a copy of payment).
5. Instructions taken by the customer regarding the claim and their date.
6. The customer's signature on the claim form, with the customer's right to recourse excluded after requesting any additional compensation for the loss, in accordance with the principle of legal recourse. Settled claims must be closed within the period specified in the policy.

(Article 8) Periodic Reports Insurance companies must submit reports on microinsurance operations to the General Authority for Financial Supervision electronically every quarter within forty-five days from the end of each quarter, including:

1. Insurance company name.
2. Coverage type.
3. Insurance type at the insurer / status of insurance on protection.
4. Number of policies (new - renewed).
5. Insurance value.
6. Premiums (paid - under collection).
7. Distribution channels (management - agents, etc.).
8. Currencies paid.
9. Claims.

(Article 9) Training of Personnel for Electronic Issuance and Distribution of Microinsurance Documents Insurance companies are responsible for training their staff and employees at electronic distribution entities on the procedures related to microinsurance documents, ensuring they are provided with the necessary information, thereby meeting their requirements, enhancing transparency, and increasing the effectiveness of the contracting parties.

(Article 10) This Decision shall be published on the Authority's electronic website, and shall be effective from the date of its issuance, and shall be notified to the concerned departments.

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Notes & Amendments:

1. The Decision was amended by the Chairman's Decision No. 2143 dated 2021/12/9, Decision No. 292 dated 2023/1/31, Decision No. 1289 dated 2023/5/25, and Decision No. 80 dated 2024/1/14.
2. The last paragraph of Article One was replaced by the Chairman's Decision No. 2143 of 2021 dated 2021/12/9. Subsequently, the amount "two hundred twenty thousand pounds" was replaced with "two hundred thousand pounds" in Article One by Decision No. 1289 dated 2023/5/25. Later, the amount "two hundred forty-two thousand pounds" was replaced with "two hundred twenty thousand pounds" in Article One by Decision No. 80 dated 2024/1/14.
3. Clause (h) was added to the first paragraph of Article Five by the Chairman's Decision No. 292 dated 2023/1/31, adding telecommunications companies and electronic stores.
   • Telecommunications Company: Refers to a company that provides wired or wireless telecommunication and data transfer services to its customers electronically and is licensed by the relevant authorities.
   • Electronic Store: Refers to a website or electronic platform on the global information network "the Internet" that displays various products (goods and services), includes lists of displayed goods and services and 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.