Conditions for the Approval of Insurance Companies

REPUBLIC OF GUINEA
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CENTRAL BANK

WORK-JUSTICE-SOLIDARITY

INSTRUCTION N° /ROA/95 CONCERNING
CONDITIONS FOR THE APPROVAL OF INSURANCE COMPANIES

THE GOVERNOR

Having regard to Law No. L/94/018/CTRN of June 1, 1994, on the statutes of the BCRG;

Having regard to Law L/95/022/CTRN of June 12, 1995, on the Insurance Code;

Having regard to Ordinance No. 322/PRG/85 of December 22, 1985, appointing the Governor of the Central Bank of the Republic of Guinea.

DECIDES:

ARTICLE 1: Constitution of the application file for approval

All documents accompanying applications for approval must be drafted in the official language of the Republic of Guinea.

The application for approval must be submitted in five copies and include:

a) the list of branches the company intends to operate;

b) where applicable, an indication of the foreign countries where the company already operates;

c) a duplicate of the company's constitutive act if it is a private deed, or an authenticated copy if it is authentic;

d) the minutes of the constitutive general meeting;

e) two copies of the articles of association; f) the list of directors and managers, as well as any person called upon to effectively exercise equivalent functions, with their names, first names, addresses, nationalities, dates and places of birth, and professional references;

The bank certificate of deposit for the amount of paid-up capital or established fund.

The persons mentioned above must provide a criminal record extract less than three months old.

Furthermore, if they are of foreign nationality, these persons must comply with the provisions of laws and regulations relating to the status and stay of foreigners.

g) A program of activities including the following documents:

1°) a document specifying the nature of the risks the company proposes to guarantee;

2°) for each branch covered by the application for approval, two copies of the policies and forms intended for public distribution or publication;

3°) for each branch covered by the application for approval, two copies of the tariffs.

If these are insurance operations involving commitments whose execution depends on the duration of human life, or operations complementary to the preceding ones, the company must provide the tariff relating to all these operations, as well as a technical note explaining the method of establishing tariffs and the bases for calculating the various categories of premiums or contributions.

If these are savings-call operations for capitalization purposes, the company must provide the complete tariff of payments or contributions, accompanied by tables indicating at least year by year the mathematical provisions and corresponding surrender values, as well as a technical note explaining the method of establishing these various elements.

4°) the guiding principles the company intends to follow regarding reinsurance;

5°) forecasts of installation costs for administrative services and the production network, as well as the financial means to cover them;

6°) for the first three financial years:

• forecasts relating to management expenses other than installation costs, notably general expenses and commissions;

• forecasts relating to premiums or contributions and claims expenses;

• the provisional cash flow statement;

7°) for the same financial years:

• forecasts relating to the financial means intended to cover commitments;

• forecasts relating to the solvency margin that the company must possess in application of the provisions of this Code;

8°) in the case of a public limited company, the list of main shareholders and the share of the share capital held by each of them; in the case of a mutual insurance company, the modalities for constituting the establishment fund;

9°) the name and address of the main banking institution where the company's accounts are domiciled;

10°) in case of an application for extension of approval, the documents mentioned in c), d) and e) of this note are not required. The company must indicate, if applicable, any modification concerning the application of the provisions of f) of this note and justify that it has a solvency margin at least equal to the regulatory amount.

ARTICLE 2: Procedures for examining the application by the Approval Committee

During the examination of the application for approval, the Approval Committee takes into account:

• the technical and financial means proposed for implementation and their adequacy to the company's activity program;

• the integrity and qualification of the persons responsible for managing it;

• the distribution of its capital or, for mutual insurance companies, the modalities for constituting the establishment fund;

• the market study.

• the qualification and professional experience of the persons mentioned in Articles 282 and 283 of the Insurance Code. These persons must provide a descriptive statement of their activities. They must notably indicate:

1°) the nature of their current professional activities and those they have exercised during the five years preceding the application for approval;

2°) whether they have been subject to disciplinary sanctions by a competent supervisory authority or professional organization, or to a refusal of registration on a professional list;

3°) whether they have been subject to dismissal or an equivalent measure for misconduct;

4°) whether they have held administrative or management positions in companies that have been subject to liquidation or judicial reorganization measures, measures concerning bankruptcies, or equivalent measures abroad.

Any unfavorable opinion must be reasoned and notified by the Approval Committee.

An unfavorable opinion indicating total or partial refusal of approval can only be issued if the company has been previously formally requested by registered letter to submit its observations in writing within a period of thirty (30) days.

The Approval Committee meets within three (3) months from the date of its referral to examine the application for approval.

ARTICLE 3: Monitoring of the activity program

During the three financial years covered by the aforementioned forecasts, the company must submit to the Insurance Supervisory Authority, for each semester, a report on the execution of the activity program.

If the reports thus presented reveal a serious imbalance in the company's financial situation, the Insurance Supervisory Authority may at any time take the necessary measures to strengthen financial guarantees deemed indispensable and, failing that, proceed with the withdrawal of approval.

ARTICLE 4: Publication of approval

Approval is published in the Official Journal of the Republic of Guinea.

ARTICLE 5:

This instruction, which takes effect from its date of signature, shall be registered and published in the Official Journal of the Republic of Guinea.

Conakry, 1995

KERFALLA YANSANE