Resolution JPRF-S-2022-029 Amending the Deadline for Submitting the Unique and Definitive Base of Insureds and Beneficiaries to COSEDE for Private Insurance Fund Coverage Payments

Resolution No. JPRF-S-2022-029
THE FINANCIAL POLICY AND REGULATION BOARD
CONSIDERING:
That, Article 226 of the Constitution of the Republic of Ecuador incorporates the principle of legality regarding State institutions, their agencies, dependencies, public servants, and persons acting by virtue of a State power; That, Article 425 ibid determines that the hierarchical order of application of norms shall be as follows: the Constitution; international treaties and conventions; organic laws; ordinary laws; regional norms and district ordinances; decrees and regulations; ordinances; agreements and resolutions; and other acts and decisions of the public powers; That, Article 13 of the Organic Code of Money and Finance, Book I, created the Financial Policy and Regulation Board, part of the Executive Function, as a public law legal entity, with administrative, financial, and operational autonomy, responsible for formulating credit, financial, securities, insurance, and prepaid comprehensive health care services policy and regulation; That, Article 14 ibid, in its items 1, 2, and 3, determines that it corresponds to the Financial Policy and Regulation Board to formulate credit, financial, including insurance policy, prepaid comprehensive health care services, and securities policy; issue regulations that allow maintaining the integrity, solidity, sustainability, and stability of the national financial, securities, insurance, and prepaid comprehensive health care services systems in accordance with what is provided in Article 309 of the Constitution of the Republic of Ecuador; and issue micro-prudential regulations for the national financial, securities, insurance, and prepaid comprehensive health care services sectors, based on proposals presented by the respective superintendencies, within their respective scopes of competence and without prejudice to their independence; That, Article 14.1 ibid, in its items 1, 13, and 17 establishes that, for the performance of its functions, the Financial Policy and Regulation Board must comply, among others, with the following duties and exercise the following powers: regulate the creation, constitution, organization, activities, operation, and liquidation of financial, securities, insurance, and prepaid comprehensive health care services entities; issue secondary legislation related to the Deposit Insurance, Liquidity Fund, and Private Insurance Fund; and, dictate norms that regulate insurance and reinsurance; That, Article 80 ibid, in its item 10, determines that the Corporation of Deposit Insurance, Liquidity Fund, and Private Insurance Fund (COSEDE) has, among others, the function of covering the risks of legally constituted private insurance companies in the country that enter forced liquidation; That, Article 344 ibid, in its second paragraph, referring to the object of the Private Insurance Fund, establishes that the Private Deposit Insurance will cover, within the amount established by the Board, the value of pending claims at the date of forced liquidation;

Resolution No. JPRF-S-2022-029

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That, through letter No. COSEDE-COSEDE-2022-0071-LETTER of February 11, 2022, the Corporation of Deposit Insurance, Liquidity Fund, and Private Insurance Fund (COSEDE) sent to the Financial Policy and Regulation Board the “Proposal to reform the deadline for submission of the unique and definitive base of insureds and beneficiaries by the liquidator to COSEDE for the payment of private insurance coverage”, related to the 30-day deadline established in Article 3 of Section II “OF THE COVERAGE OF THE PRIVATE INSURANCE FUND”, Chapter I “GENERAL NORMS OF THE PRIVATE INSURANCE FUND”, Title V “OF THE PRIVATE INSURANCE FUND”, Book III “PRIVATE INSURANCE SYSTEM” of the Codification of Monetary, Financial, Securities and Insurance Resolutions of the Financial Policy and Regulation Board; That, the Technical Secretariat of the Financial Policy and Regulation Board, through memorandum No. JPRF-SETEC-2022-0046-M of May 13, 2022, sends to the President of the Board Technical Report No. JPRF-CT-2022-0025 and Legal Report No. JPRF-CJ-2022-0022, both dated May 4, 2022, which contain the analysis, conclusions, and recommendations regarding the case in question; That, the Financial Policy and Regulation Board, in an ordinary session held by technological means convened on May 14, 2022 and carried out through video conference on May 17, 2022, learned of and resolved on memorandum No. JPRF-SETEC-2022-0046-M of May 13, 2022, issued by the Technical Secretariat and its annexes; and, In exercise of the attributions and duties conferred by Article 14.1 of the Organic Code of Money and Finance, Book I, the Financial Policy and Regulation Board, RESOLVES:
Sole Article.- Substitute Article 3 of Section II “OF THE COVERAGE OF THE PRIVATE INSURANCE FUND” Chapter I “GENERAL NORMS OF THE PRIVATE INSURANCE FUND”, Title V “OF THE PRIVATE INSURANCE FUND”, Book III “PRIVATE INSURANCE SYSTEM” of the Codification of Monetary, Financial, Securities and Insurance Resolutions, with the following:

“Art. 3.- The coverage of the Private Insurance Fund, in accordance with what is provided in Article 80, item 10; and, Article 344, second paragraph of the Organic Code of Money and Finance, will be limited to the payment, by the Corporation of Deposit Insurance, Liquidity Fund, and Private Insurance Fund (COSEDE), of pending claims at the date the forced liquidation of an insurance company in the private insurance system is declared, which will be paid by COSEDE up to the total protected amount of the Private Insurance Fund. Pending claims shall be understood as those that have occurred and been accepted by the insurance company in forced liquidation.

Resolution No. JPRF-S-2022-029

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Regarding claims that have occurred and have not been reported, insureds may report them to the liquidator, who shall be responsible for accepting or rejecting them.
The liquidator will deliver to COSEDE the database of insureds or beneficiaries, which must obligatorily include the value of each claim, with which the payment of the coverage of the Private Insurance Fund will be made.”
FINAL PROVISION.- This Resolution shall enter into force from the present date, without prejudice to its publication in the Official Register. Publish this Resolution on the website of the Financial Policy and Regulation Board, within a maximum term of two days from its issuance.
NOTIFY.- Given in the Metropolitan District of Quito, on May 17, 2022.
THE PRESIDENT,
Mgs. María Paulina Vela Zambrano
The preceding resolution was processed and signed by Master María Paulina Vela Zambrano, President of the Financial Policy and Regulation Board, in the Metropolitan District of Quito, on May 17, 2022.- I CERTIFY.
TECHNICAL SECRETARIAT
Dr. Nelly Arias Zavala