Instruction No. 004/2023-CSBF of October 27, 2023 on the Reporting Obligations of Insurance Companies

INSTRUCTION NO. 004/2023-CSBF OF OCTOBER 27, 2023 ON THE REPORTING OBLIGATIONS OF INSURANCE COMPANIES

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TABLE OF CONTENTS

Article 1. OBJECT................................................................................................................................ 1
Article 2. SCOPE OF APPLICATION.......................................................................................................... 1
Article 3. REPORTING OBLIGATIONS.............................................................................................. 1
Article 4. FINANCIAL INFORMATION.............................................................................................. 2
Article 5. STATISTICAL INFORMATION............................................................................................. 2
Article 6. OTHER REPORTS AND DOCUMENTS.................................................................................. 3
Article 7. TELE-DECLARATION SYSTEM........................................................................................ 4
Article 8. PUBLICATION OF ANNUAL FINANCIAL STATEMENTS............................................................ 4
Article 9. ACCOUNTING PRINCIPLES AND STANDARDS – DOCUMENT RETENTION...... 4
Article 10. SANCTIONS.............................................................................................................................. 4
Article 11. TRANSITIONAL PROVISIONS............................................................................................ 5
Article 12. ENTRY INTO FORCE............................................................................................................ 5
ANNEXES...................................................................................................................................................... 6
ANNEX 1 Financial and Statistical Information.................................................................................. 7
ANNEX 2 Control Statements...................................................................................................................... 8
ANNEX 3 List of Other Information and Documents......................................................................... 30

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BANKY FOIBEN'I MADAGASIKARA
COMMISSION DE SUPERVISION BANCAIRE ET FINANCIERE (CSBF)

INSTRUCTION NO. 004/2023-CSBF
ON THE REPORTING OBLIGATIONS
OF INSURANCE COMPANIES

The Banking and Financial Supervision Commission (CSBF), Having regard to Law No. 2020-005 of September 1, 2020 on insurance; Having regard to the opinion issued by the Professional Association of Insurance Companies in Madagascar (APEAM); Pursuant to the provisions of Articles 254, 260, 312, and 313 of the aforementioned Insurance Law;

DECIDES

Article 1. Object

This instruction aims to:

• specify the reporting obligations to which the entities referred to in Article 2 below are subject, as well as their nature and content;
• set the procedures and frequency for submitting information and documents to the CSBF, as well as the conditions for their publication.

Article 2. Scope of Application

This instruction applies to insurance or reinsurance companies, abbreviated as "ICs", referred to in Article 192 of the Insurance Law, hereinafter referred to as "subject entities".

Article 3. Reporting Obligations

Subject entities must submit the following information and documents to the CSBF:

• financial and statistical information specified in ANNEX 1,
• detailed control statements in ANNEX 2;
• all other information and documents required under supervision as specified in ANNEX 3.

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Article 4. Financial Information

Financial information consists of:

• financial statements comprising the balance sheet, income statement, statement of changes in equity, statement of cash flows, and notes to the financial statements,
• and reports from the statutory auditors.

The following are subject to:

1. Monthly Declaration, within twenty-five (25) days after the closing date:
   a) detailed balance sheet, b) detailed income statement.

2. Quarterly Declaration, within twenty-five (25) days after the closing date:
   a) detailed balance sheet, b) detailed income statement, c) capital requirements and solvency as provided by the relevant instruction.

To this end, ICs transmit to the CSBF their cumulative quarterly balance sheet and income statement starting from the second quarter of year N.

3. Annual Declaration
   a) unaudited financial statements, no later than March 31 of year N+1. After reviewing the submitted documents, the CSBF acknowledges receipt to the IC or notifies it of any observations. In case of observations, the CSBF rules within one (1) month from receipt of the documents. The letter from the General Secretariat or the Commission's decision is communicated to the General Assembly; b) audited financial statements accompanied by the full reports related to these documents prepared by the statutory auditors, no later than May 31 of year N+1 and one (1) month before the General Assembly meeting, submitted digitally and physically in three (3) copies. c) audited financial statements of the immediate parent company and the ultimate parent company for ICs belonging to a group, as soon as they are available.

Article 5. Statistical Information

Subject entities transmit to the CSBF the statistical information or control statements "STATEMENTS C" listed below according to the formats specified in ANNEX 2 of this instruction:

• STATEMENT C1 – NON-LIFE: Breakdown by operation category of cumulative operating result,
• STATEMENT C1 – LIFE: Breakdown by operation category of cumulative operating result;

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• STATEMENT C2: Operating elements – cumulative personnel;
• STATEMENT C3: Technical provisions and their coverage cumulative;
• STATEMENT C4: Summary of technical provisions and their cumulative coverage;
• STATEMENT C5 LIFE AND NON-LIFE: Allocation by underwriting year of premium arrears (collections and cancellations);
• STATEMENT C6: Allocation by operation category, agency, and age of premium arrears;
• STATEMENT C7–LIFE AND NON-LIFE: Claim payments and technical provisions for claims payable (SAP), all years combined – Allocation by life and non-life insurance categories;
• STATEMENT C8 – NON-LIFE: Claim payments and technical provisions for SAP – Non-life aggregate (excluding auto);
• STATEMENT C9: Preliminary tables of SAP and settlements by accident year – Non-life aggregate (excluding auto);
• STATEMENT C10 AUTO: Claim payments and technical provisions for SAP non-life – Allocation of the automobile category;
• STATEMENT C11 AUTO: Claim payments and technical provisions for SAP non-life – Automobile category;
• STATEMENT C12 AUTO: Preliminary tables of SAP and settlements by accident year;
• STATEMENT C13: Portfolio structure.

Statistical information is transmitted electronically via the tele-declaration system managed at the CSBF level, following the indications listed in Article 7 of this instruction.

The following are subject to declaration:

• Quarterly, within twenty-five (25) days after the closing date:

  • STATEMENT C1 – Breakdown by operation category of cumulative operating result,
  • STATEMENT C2 – Operating elements – cumulative personnel;
  • STATEMENT C3 – Technical provisions and their coverage;
  • STATEMENT C4 – Summary of technical provisions and their cumulative coverage.

• Annual, no later than March 31 of year N+1:

  • Complete STATEMENTS C.

Article 6. Other Reports and Documents

In addition to the financial and statistical information provided in Articles 4 and 5 above, subject entities must annually submit to the CSBF, along with the audited financial statements, the following documents:

• the management report of the Board of Directors (Article 153 of the Commercial Companies Law),

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• the solvency report of the Board of Directors (Article 313 of the Insurance Law);
• the actuary's report (Article 312, point 4);
• the minutes of the General Assembly.

Pursuant to Article 254 of the Insurance Law, the other information to be communicated to the CSBF, as well as their transmission procedures, are detailed in ANNEX 3 of this instruction.

Article 7. Tele-declaration System

Subject entities are required to use the tele-declaration system established and managed by the CSBF. To this end, they must:

• communicate electronically, via this system according to pre-established models, the periodic declarative statements and reports provided for in Articles 4, 5, and 6 above,
• comply with the user guide made available to them by the CSBF, particularly regarding access and system manipulation procedures and the electronic formats accepted for tele-declaration;
• take necessary arrangements and precautions to ensure the confidentiality of transmitted data and identification information related to access to the aforementioned system, particularly by informing the CSBF of any user changes within the supervised entity;
• submit a reasoned request to the CSBF, via the system, in case of transmission beyond the deadlines set in this instruction.

Article 8. Publication of Annual Financial Statements

Pursuant to Article 313 of the Insurance Law, subject entities must publish, in at least two (2) of the main national press organs under the "Legal Notices" section and on the IC's website, the audited annual financial statements excluding the notes. These publications must:

• include the general report with the statutory auditors' opinion on the fairness and regularity of the information provided;
• be completed within forty-five (45) days from the approval of the accounts by the competent body.

Article 9. Accounting Principles and Standards – Document Retention

Subject entities must maintain their accounting and present financial information regarding their activities in accordance with the Insurance Accounting Plan (PCAss).

Without prejudice to legal obligations regarding document retention, subject entities are required to retain all elements used to prepare the periodic financial statements submitted to the CSBF for a period of five (5) years.

Article 10. Sanctions

Failure to comply with the provisions of this instruction results in the application of one or more disciplinary and financial sanctions provided for by Law No. 2020-005 of September 1, 2020.

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Article 11. Transitional Provisions

Pending the availability of the tele-declaration system cited in Article 8 above, tele-declaration shall be carried out via email addressed to the General Secretariat of the CSBF.

Article 12. Entry into Force

This instruction enters into force upon its notification to the Professional Association of Insurance Companies in Madagascar (APEAM). It applies to declarations relating to the 2023 fiscal year.

The annexes form an integral part of this instruction.

Issued in Antananarivo, on OCT 27, 2023
For the Banking and Financial Supervision Commission

THE PRESIDENT,
AIVO H. ANDRIANARIVELO

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ANNEXES

ANNEX 1 - FINANCIAL AND STATISTICAL INFORMATION ........................................................ 7
ANNEX 2 - CONTROL STATEMENTS ....................................................................................................... 8
STATEMENT C1 - Non-life Insurance - Breakdown by operation category of cumulative operating result .................................................................................................................................................... 8
STATEMENT C1 - Life Insurance - Breakdown by operation category of cumulative operating result ............................ 10
STATEMENT C2 - Operating Elements - Cumulative Personnel ....................................................................... 12
STATEMENT C3 - Cumulative Technical Provisions and Their Coverage .............................................................. 13
STATEMENT C4 - Summary of Cumulative Technical Provisions and Their Coverage ....................................... 16
STATEMENT C5 - LIFE AND NON-LIFE - Allocation by underwriting year of premium arrears (collections and cancellations) ................................................................................................................. 19
STATEMENT C6 - Allocation by operation category, agency, and age of premium arrears .................... 20
STATEMENT C7 - LIFE AND NON-LIFE - Claim payments and technical provisions for claims payable (SAP), all years combined – Allocation by life and non-life business lines .................................................................................................................................................... 21
STATEMENT C8 - NON-LIFE - Claim payments and technical provisions for SAP - Non-life aggregate (excluding Auto) ........................................................................................................................................... 22
STATEMENT C9 - Preliminary tables of SAP and settlements by accident year - Non-life aggregate (excluding auto) ........................................................................................................................................... 23
STATEMENT C10 - AUTO - Claim payments and technical provisions for SAP non-life - Allocation of the automobile category ........................................................................................................................... 24
STATEMENT C11 - AUTO - Claim payments and technical provisions for SAP non-life ...................... 25
STATEMENT C12 - AUTO - Preliminary tables of SAP and settlements by accident year ........... 26
STATEMENT C13 - Portfolio Structure ....................................................................................................... 27
ANNEX 3 - LIST OF OTHER INFORMATION AND DOCUMENTS ........................................... 30

1. Information ............................................................................................................................................. 30
2. Documents ................................................................................................................................................ 31
   2.1. IC Profile Sheet ................................................................................................................. 31
   2.2. Group Information ................................................................................................................ 33
   2.3. Parent Company Transactions as of December 31, N-1 ................................................................... 34
   2.4. Information on Immediate and Ultimate Parent Companies as of December 31, N-1 .......................... 35
   2.5. Summary of Reinsurance Contract Information ............................................................. 36

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ANNEX 1

FINANCIAL AND STATISTICAL INFORMATION

TYPES OF INFORMATION	FREQUENCY
	Monthly	Quarterly	Annual
FINANCIAL INFORMATION
1. Monthly unaudited financial statements	25 days after closing date
2. Quarterly unaudited financial statements		25 days after closing date
3. Annual unaudited financial statements			by March 31/N+1 at the latest
4. Annual audited financial statements			May 31/N+1 and 1 month before GA
5. Annual audited financial statements of parent company for ICs belonging to a group			30 days after closing date
STATISTICAL INFORMATION
6. STATEMENTS C1 - NON-LIFE and LIFE - Breakdown by operation category of cumulative operating result
7. STATEMENT C2 - Operating elements - cumulative personnel		25 days after closing date
8. STATEMENT C3 - Cumulative technical provisions and their coverage
9. STATEMENT C4 - Summary of cumulative technical provisions and their coverage
10. Complete STATEMENTS C			30/03/N+1

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ANNEX 2

CONTROL STATEMENTS

STATEMENT C1 - NON-LIFE INSURANCE - BREAKDOWN BY OPERATION CATEGORY OF CUMULATIVE OPERATING RESULT

Instruction: This form must be prepared for non-life insurance. A separate column must be included for each operation category as indicated in Annex 1 as well as for the total of all operation categories.

FINANCIAL STATEMENT CORRESPONDENCES		Column for each category	TOTAL
GROSS PREMIUMS WRITTEN	NET PREMIUMS AFTER CANCELLATION
	less: RISKS IN COURSE FOR YEAR N
CHANGE IN REINSURANCE RECEIVABLES	plus: RISKS IN COURSE FOR YEAR N-1
	a - PREMIUMS EARNED FOR THE YEAR
COMPONENT OF REINSURANCE CESSION RESULTS	PREMIUMS CEDED TO REINSURERS
	less: RISKS IN COURSE CEDED FOR YEAR N
	plus: RISKS IN COURSE CEDED FOR YEAR N-1
	b - PREMIUMS EARNED FOR YEAR N BY REINSURERS
	c = a - b : NET PREMIUMS EARNED
COMPONENT OF INCURRED CLAIMS	NET CLAIMS AFTER RECOVERY
	plus: CLAIMS PAYABLE FOR YEAR N
	less: CLAIMS PAYABLE FOR YEAR N-1
INSURANCE BENEFIT EXPENSES EXCLUDING LIFE PB¹	d - CLAIM EXPENSES
	CLAIMS CHARGED TO REINSURERS
	plus: CLAIMS PAYABLE FOR YEAR N CHARGED TO REINSURERS
	less: CLAIMS PAYABLE FOR YEAR N-1 CHARGED TO REINSURERS
COMPONENT OF REINSURANCE CESSION RESULTS	e - REINSURERS' SHARE IN CLAIM EXPENSES
	f = d - e : NET CLAIM EXPENSES
	g = a - d : TECHNICAL RESULT ON DIRECT BUSINESS
	h = b - e : TECHNICAL RESULT ON REINSURANCE CESSIONS

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FINANCIAL STATEMENT CORRESPONDENCES		Column for each category	TOTAL
	i = g - h : NET TECHNICAL RESULT
REINSURANCE CESSION RESULTS	j = -b + e + (2) : REINSURANCE CESSION RESULT
	1. CONTRACT ACQUISITION COSTS ON DIRECT BUSINESS
	2. COMMISSIONS RECEIVED FROM REINSURERS
	3. NET FINANCIAL INCOME
	4. FAIR VALUE CHANGES ON FINANCIAL INSTRUMENTS
	5. DEPRECIATION CHANGES ON FINANCIAL INSTRUMENTS
	6. INCOME FROM OTHER ACTIVITIES
	7. OTHER OPERATING EXPENSES
	8. OTHER INCOME
	9. ADMINISTRATIVE EXPENSES
	10. OTHER CURRENT OPERATING INCOME AND EXPENSES
	11. OTHER OPERATING EXPENSES
	PROFIT BEFORE TAX - NON-LIFE
	NET LOSS RATIO (f/c)
	EXPENSE RATIO ((1-2-3-6+7-8+9+10+11) / c)
	COMBINED RATIO (net loss ratio + expense ratio)

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ANNEX 2

CONTROL STATEMENTS

STATEMENT C1 - LIFE INSURANCE - BREAKDOWN BY OPERATION CATEGORIES OF CUMULATIVE OPERATING RESULT

Instruction: This form must be prepared for life insurance. A separate column must be included for each operation category as indicated in Annex 1 as well as for the total of all life insurance operation categories.

FINANCIAL STATEMENT CORRESPONDENCES		Column for each category	TOTAL
GROSS PREMIUMS WRITTEN	NET PREMIUMS AFTER CANCELLATION
	less: MATHEMATICAL PROVISIONS FOR YEAR N
CHANGE IN REINSURANCE RECEIVABLES	plus: MATHEMATICAL PROVISIONS FOR YEAR N-1
	a - PREMIUMS EARNED FOR YEAR N
COMPONENT OF REINSURANCE CESSION RESULTS	PREMIUMS CEDED TO REINSURERS
	less: MATHEMATICAL PROVISIONS CEDED FOR YEAR N
	plus: MATHEMATICAL PROVISIONS CEDED FOR YEAR N-1
	b - PREMIUMS EARNED FOR YEAR N BY REINSURERS
	c = a - b : NET PREMIUMS EARNED
COMPONENT OF INCURRED CLAIMS	NET CLAIMS AFTER RECOVERY
	plus: CLAIMS PAYABLE FOR YEAR N
	less: CLAIMS PAYABLE FOR YEAR N-1
INSURANCE BENEFIT EXPENSES EXCLUDING LIFE PB¹	d - CLAIM EXPENSES
	CLAIMS CHARGED TO REINSURERS
	plus: CLAIMS PAYABLE FOR YEAR N CHARGED TO REINSURERS
	less: CLAIMS PAYABLE FOR YEAR N-1 CHARGED TO REINSURERS
COMPONENT OF REINSURANCE CESSION RESULTS	e - REINSURERS' SHARE IN CLAIM EXPENSES
	f = d - e : NET CLAIM EXPENSES
	g = a - d : TECHNICAL RESULT ON DIRECT BUSINESS

¹ Share on profit

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FINANCIAL STATEMENT CORRESPONDENCES		Column for each category	TOTAL
	h = b - e : TECHNICAL RESULT ON REINSURANCE CESSION
	i = g - h : NET TECHNICAL RESULT
REINSURANCE CESSION RESULTS	j = -b + e + (2) : REINSURANCE CESSION RESULT
	1. CONTRACT ACQUISITION COSTS ON DIRECT BUSINESS
	2. COMMISSIONS RECEIVED FROM REINSURERS
	3. NET FINANCIAL INCOME
	4. FAIR VALUE CHANGES ON FINANCIAL INSTRUMENTS
	5. DEPRECIATION CHANGES ON FINANCIAL INSTRUMENTS
	6. INCOME FROM OTHER ACTIVITIES
	7. OTHER OPERATING EXPENSES
	8. OTHER INCOME
	9. ADMINISTRATIVE EXPENSES
	10. OTHER CURRENT OPERATING INCOME AND EXPENSES
	11. OTHER OPERATING EXPENSES
	PROFIT BEFORE TAX - LIFE
	NET LOSS RATIO (f/c)
	EXPENSE RATIO ((1-2-3-6+7-8+9+10+11) / c)
	COMBINED RATIO (net loss ratio + expense ratio)

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ANNEX 2

CONTROL STATEMENTS

STATEMENT C2 - OPERATING ELEMENTS - CUMULATIVE PERSONNEL

	Year N-1	Year N
	Technical & Sales Personnel	Other Personnel	Technical & Sales Personnel	Other Personnel
A) PERSONNEL HEADCOUNT
Management
Executives
Non-executives
Total
TOTAL PERSONNEL
B) PERSONNEL EXPENSES
Salaries
Retirement Pensions
Social Charges
Other Remuneration
TOTAL
C) PREMIUM CONTRIBUTION FROM PERSONNEL
D) BROKERAGE COMMISSIONS FROM PERSONNEL

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ANNEX 2

CONTROL STATEMENTS

STATEMENT C3 - CUMULATIVE TECHNICAL PROVISIONS AND THEIR COVERAGE

Instruction: This form must be filled out separately for life insurance and non-life insurance.

Provisions for risks in course:
Provisions for claims payable:
Mathematical provisions:
TOTAL A:
Provisions for risks in course - Acceptance:
Provisions for claims payable - Acceptance:
Mathematical provisions - Acceptance:
TOTAL B:
TOTAL TECHNICAL PROVISIONS: (A+B)

ACTIVES REPRESENTATIVE

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