Syrian Arab Republic

Insurance supervisory Commission

The executive instructions of legislative decree /43/year2005

Legislative decree no./43/year 2005 and its executive instructions ,and legislative decree no./68/ year 2004 aim to secure rights of insured and investors , besides rendering insurance services in accepted prices through equal competition , aiming to develop insurance sector and achieve stability .

                                  Insurance types

Article/1/ :Provisions of this decree includes  the following insurance sectors :

First public insurance includes the following branches :

Accident and liability insurance : -

Personal accident insurance.                                  *

*Industrial injury insurance .

*Employer liability insurance.

*Civil liability insurance.

*Professional liability insurance.

*Burglary and theft insurance .

*Surety and fidelity insurance.

*Movable money insurance , deposits of treasuries ,indebtedness, loans security , secure executing .

-Automobile insurance this includes insurance against loss , damages , and liabilities related to using cars and other vehicles .

-Property insurance :this includes insurance against fire loss and damages ,theft , explosion , natural phenomena, disturbance and disorder ,beside any insurance falls under this category .

-Transport insurance implies the following :

*Marine insurance : it includes insurance of goods transported by sea ,ship’s hull their machines and the related liabilities .

*Land and river transport .

-Airline insurance: it includes insuring the planes ^, hull and air transported goods , in addition to responsibilities towards  passengers and others .

-Energy insurance : : it includes insuring petroleum enterprises , petrochemical enterprises and other energy enterprises with the resulting liabilities .

-Geometric insurance : this includes risks insurance of contractors and entrepreneurs , risks of construction and erection , of breaking mechanical , electrical ,electronic machines and equipment .

Second –health insurance

This includes insurance of costs of medical treatment , medicines , remedy and medical services and requirements as well as managing medical program .

Third –Life insurance and forming capitals :

1)Life insurance : includes insurance of death causes and cause of complete permanent or partial or temporary inability.

2) Life insurance with savings : by this kind of insurance the assured guarantees a sum or amounts ,including outcome of savings and investment , in future dates against his participation payments .

Fourth-Agricultural insurance :

Crop insurance  against risks of agricultural disease , effects of various natural phenomena ,fire , animal raising and other insurance fall under this kind .

Article /2/:In addition to the above mentioned in article /1/ supervisory insurance commission has the right to set details of the subsidiary insurance which are listed in any branch of insurance , this commission can state new kinds of insurance imposed by insurance demand or because of insurance practice .

Procedures of license and registering of Insurance companies and reinsurance.

Article/3/-*Authorities interested in establishing insurance companies or reinsurance have to submit an initial proposal to supervisory insurance commission according to the designed pattern which should be sealed with commission’s seal after paying the determined allowance .

*Commission make a primary examination of the proposal ,it is allowed to call  its owner or ask him to complete the required public information .

According to articles no /4/ and /5/ of these instructions , if the result of primary examination is positive , commission will ask the interested authorities to submit an official license  proposal to establish the insurance company.

Article  /4/:License demand that is submitted to commission should include the following :

*The special pattern of demand which is designed by commission including  :

1-The company name .

2-The type of insurance .

3-The suggested capital.

4-Capital that is subject to subscription .

5-The total number of shares ,the value of each one must be /500 /SP.

6-The names of establishers of natural people and entities , their nationalities , practices ,addresses of domiciles and their shares .

7-Establishment contract .

8-Regulation.

9-Orgnising framework .

10-Studying the economic use .

11-The five –year work plan which implies the following :

a-The kind of insurance that the company will practice with risks to be covered .

b-The available facilities of reinsurance of all kinds whether single or               .

c-Marketing plan of the adopted insurance productions .

d-The prospected banks and required finance resources .

e-The expected growth rates of company’s function taking into consideration requirements of solvency.                    .

f-The prospected employees^, number as well as number of non –Syrian workers within the company .

g-The technical bases of insurance and reinsurance .

Article/5/:The authority desired to licensed insurance company has to submit reliable data about chairmen and members of legal entities broad of directors as follows :

·        A statement showing names of chairman , members of abroad of directors , of general director of each legal entity participating in founding company .

·        A statement showing names of companies and establishments in which chairman , members of broad of legal entity and general director participate mentioning also their shares .

·        A detailed statement showing experiences of chairmen , members of broad of legal entity and general director who are participating in establishing company in the insurance and reinsurance sectors .

·        If company will adopt joint liability (Islamic ) system in its function  ,in this case it must be declared clearly in establishment request besides stating the legitimacy supervision within which it will work in addition to its ways .

Article/6/:After completion of required data and documents stated in (article4,5) of this instructions ,a proposal will be submitted to insurance supervisory commission which will issue notice of receipt after paying the stated allowance.

Article/7/:Commission has to notify authority which submitted a proposal during forty-five days from the date of presenting its proposal to complete  the required data and documents or other requirements.

Article/8/: According to provisions of legislative decree no./43/ year 2005 commission will examine carefully the proposal, data and documents, also it is responsible for studying and evaluating the proposal taking into consideration the ability of the authority as well as qualifications , capacity ,and reputation of legal entities , and evaluating their previous experience in insurance and reinsurance sectors in other countries if it exists ,considering the needs of national insurance market , in this light commission board will take a decision then forward it to cabinet to issue necessary decision .

Article/9/: Within ninety days of receipt notice a proposal is canceled if the prime minister does not issue a decision  whether a positive or negative one .

Article/10/

a- in case a proposal is refused , the authority asking license has the right to over view refusal justifications , and can submit again a new one ÇÓÊÏÑß               .

b-In case of refusal , the paid expenses and allowance to commission against for studying proposal will not be returned .In case submitting a new proposal , the license allowance should be paid .

Article/11/:License decision issued by Prime minister should imply the following :

Data stated in articles (1,2,3,4)of article /4/ of these instructions should be :

a)The total of shareholders participating in establishment will not be less than (25%) of subscripted capital upon submitting  the proposal .

b)The share of natural individual shall not exceed (5%) of company’s capital .

c) The share of any legal entity shall not exceed (40%) of company’s capital  , with necessary of obtaining a previous approval of commission for any share .

Article/12/Syrian participation will be paid in Syrian Pounds ,while non-Syrian participation will be paid in foreign currency according to official exchange list issued by Central Bank of Syria , these payments registered in the name of company at any licensed bank , provided that the company’s capital should be  fully paid and deposed in its account before registering it at commission and issuing order of commencement.

Article/13/According to provisions of legislative decree no./43/ year 2005 the licensed company deposes in a freeze account (in the name of insurance supervisory commission ) an amount of (2) million Syrian Pounds for each and every kind of insurance it practices before it is registered and obtains order of commencement , provided that the deposed total will not exceed (25) million Syrian Pounds , this amount deemed as an asset which will be returned when company’s liquidation officially occurs.

Article/14/Insurance companies that are licensed according to provisions of legislative decree no./43/dated 6/5/2005 , have the right to transfer the below mentioned due in foreign currency :

1-The annual net profits of Arab and foreign citizens shares and participation that are paid in foreign currency after ÊäÒíá   the obligatory and particular reserves determined by public shareholders assembly and stipulations of insurance supervisory commission .

2-The net rewards and compensations after deducting taxes related to members of board of non-Syrian residents or those  legally treated like them .

3-50%of net wages ,salaries and rewards ,and 100% of net due compensations at the end of service for experts and technical working in insurance company from Arab and non-Arab citizens .

4-The net balanced of reinsurance resulting from deducting commissions of reinsurance , profits ,and share of reinsurance from technical reserves .

5- Company due amounts that should be paid and transferred outside in foreign currency.

                                Companies administration

Article/15/ :

a-    The board of directors manages company , which is chosen by shareholders according to provisions of company’s basic regulations ,board’s  chairman , members and executive directors are characterized with scientific knowledge  and technical experience in all fiscal as well as insurance matters that are necessary to perform their tasks .

b-   B-Any change in board’s members or its general director is subject to insurance supervisory commission’s approval to ensure a continuos adherence to conditions and qualifications determined in legislative decree no./43/ year 2005 as well as in basic regulations of company .

Article/16/:Chairmen and members of boards of licensed insurance companies as well as their general directors and other directors  are subject to provisions of article/13and14/ of legislative decree no./43/year 2005

Article/17/A company ,before starting its work , has  to present to commission a statement showing a specific  number of non-Syrian employees who will work in the company , and characterized with qualifications and experiences not found in the national market after getting approval of commission general director .The company commits to prepare and train Syrian citizens on various activities related to insurance .

Article/18/Company undertakes to present an annual detailed  report attached to final accounts and other statements related to insurance it practices within /90/days from the end of fiscal year .

                         Technical Reserves

Article/19/:A-Technical  appropriations are calculated according to criteria set by insurance supervisory commission conditionally they reflect clearly company’s commitments and include the following :

1-    premium reserve .

2-    reserve of claims under settlement (including settlement costs )

3-    Reserve of happened accidents  without any claim.

4-    Reserve of disasters.

5-    Reserves concerning life insurance , disability ,senility ,death and health expenses.

B-A company forwards a detailed statement of its technical  reserves account including ways and rates which are adopted in its calculations .