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The document ceased to be valid since  January 1, 2024 according to Item 2 of the Section XV of the Law of Ukraine of November 18, 2021 No. 1909-IX

LAW OF UKRAINE

of March 7, 1996 No. 85/96-BP

About insurance

(as amended on 11-04-2023)

This Law governs the relations in the sphere of insurance and is directed to creation of the market of insurance services, strengthening of insurance protection of valuable interests of the companies, organizations, organizations and physical persons.

Operation of this law does not extend to the national social insurance.

State regulation and supervision of activities of Export credit agency is exercised by the National Bank of Ukraine taking into account the features established by the Law of Ukraine "About financial mechanisms of stimulation of export activities". Activities of Export credit agency are performed according to the Law of Ukraine "About financial mechanisms of stimulation of export activities". Operation of this Law extends to activities of Export credit agency regarding the conclusion, execution and the terminations of the insurance contracts and reinsurance concluded by Export credit agency when implementing activities for insurance and reinsurance.

This Law governs the relations connected with insurance of agricultural products with the state support taking into account the features established by the Law of Ukraine "About features of insurance of agricultural products with the state support".

Section I. General provisions

Article 1. Concept of insurance

Insurance is type of the civil relations on protection of valuable interests of physical persons and legal entities in case of approach of certain events (insured events) determined by the insurance contract or the current legislation at the expense of the cash funds created by payment physical litsm and legal entities of insurance payments (insurance premiums, insurance premiums) and the income from investment of funds of these funds.

Article 2. Insurers

The insurers having the right to perform insurance activity in the territory of Ukraine are:

financial institutions which are created in the form of joint-stock, complete, limited companies or additional liability companies according to the Law of Ukraine "About economic societies" taking into account that participants of each of such financial institutions there shall be at least three, and other features provided by this Law and also obtained in accordance with the established procedure the license for implementation of insurance activity (further - resident insurers);

the permanent missions in form of branches of foreign insurance companies registered by Authorized body according to this Law and the legislation of Ukraine which also obtained in accordance with the established procedure the license for implementation of insurance activity (further - branches of nonresident insurers).

The export credit agency is considered the resident insurer with the special status.

Financial institutions which are created are considered as nonresident insurers and have the license for carrying out insurance activity according to the legislation of those foreign states in which they are registered.

The provisions of this Law applied to resident insurers are applied to branches of nonresident insurers with the features established by this Law.

It is forbidden to perform insurance activity in the territory of Ukraine nonresident insurers, except the following types of insurance activity:

only on risks insurance, connected with maritime transports, commercial aircraft, start of space rockets and the freight (including satellites) if object of insurance are the valuable interests connected with the transported goods and/or the vehicle by which they are transported, and/or any responsibility arising in connection with such transportation of goods;

reinsurance;

insurance mediation, such as broker and agency transactions concerning: reinsurance, it is exclusive with risks insurance, connected with maritime transports, commercial aircraft, start of space rockets and the freight (including satellites) if object of insurance are the valuable interests connected with the transported goods and/or the vehicle by which they are transported, and/or any responsibility arising in connection with such transportation of goods;

support services in insurance, such as consulting services, assessment of actuarial risk and satisfaction of claims.

In some cases, established by the legislation of Ukraine, insurers the state organizations created and operating according to this Law are recognized. In this case use of the words "state", "national" or derivative of them in the name of the insurer is allowed only on condition that the single owner of such insurer is the state.

Words "insurer", "insurance company", "insurance organization" and derivative of them is allowed to use in the name only to those legal entities who have the license for implementation of insurance activity.

The general size of fees of the insurer in the authorized capital of other insurers of Ukraine cannot exceed 30 percent of its own authorized capital, including the fee size in the authorized capital of the certain insurer cannot exceed 10 percent. These requirements do not extend to the insurer performing types of insurance others, than life insurance, when implementing of fees by it in the authorized capital of the insurer performing life insurance.

During creation of the resident insurer or increase in the registered authorized capital the authorized capital shall be paid exclusively in cash. Forming of the authorized capital of the resident insurer by the securities issued by the state, on their nominal value according to the procedure, determined by the National Bank of Ukraine (further - Authorized body), but no more than 25 percent of the general size of the authorized capital is allowed.

It is forbidden to use for forming of the authorized capital of the bill of exchange, means of insurance reserves, and also the means received on credit, I will jam and on the security and to bring intangible assets.

Order of registration, licensing, implementation of supervision of activities, application of corrective actions and liquidation of branches of nonresident insurers are established by this Law and regulatory legal acts of Authorized body.

The nonresident insurer has the right to opening of branch in Ukraine under following conditions:

1) the state in which the nonresident insurer is registered does not treat the states which are not taking part in international cooperation in the sphere of the prevention and counteraction of legalization (washing) of income gained in the criminal way and to terrorism financing and also cooperates with Group on development of financial measures of anti-money laundering (FATF);

2) between authorized body on implementation of supervision of insurance companies of the country in which the nonresident insurer is registered and the Authorized body signed the memorandum (the agreement is signed) on exchange of information;

3) behind insurance activity according to the legislation of country of incorporation of the nonresident insurer the state supervision is exercised;

4) between Ukraine and the country in which the nonresident insurer is registered the international treaty on the prevention of tax evasion and avoidance of double taxation is signed;

5) the nonresident insurer is located in the territory of the countries or the separate territories which according to the decision of UN Organization for Economic Cooperation and Development have no offshore status, or in the territory of other countries if not offshore status of such insurer is confirmed with the conclusion of the corresponding trade and economic mission;

6) the rating of financial reliability (stability) of the nonresident insurer conforms to the requirements established by Authorized body;

7) the minimum size of security deposit on accounts of authorized resident banks which have the license for implementation of transactions in all territory of Ukraine and are not at the time of placement of such deposit in the procedure of sanitation, financial improvement or bankruptcy, at the time of registration of branch at least minimum size of authorized fund of the resident insurer established in article 30 of this Law is.

The procedure for the mode of the account on which such deposit is considered is established by the joint decision of the Cabinet of Ministers of Ukraine and the National Bank of Ukraine.

Requirements to security deposit are established by Authorized body;

8) availability of the commitment irrevocable letter of the nonresident insurer about unconditional accomplishment of the obligations which arose in connection with activities of its branch in the territory of Ukraine by it;

9) insurers of Ukraine are granted the right to open the branches in the territory of foreign state in which it is created and the nonresident insurer acts.

Registration of branches of nonresident insurers is performed by Authorized body.

Activities of branch of the nonresident insurer shall conform to the requirements established by this Law and/or regulatory legal acts of Authorized body.

Insurance, reinsurance and the financial activities connected with forming, placement of insurance reserves and their management can only be subject of direct activities of the insurer.

Are resolved accomplishment of the specified types of activity in the form of rendering services for other insurers based on the signed civil agreements, rendering services (performance of works) if it is directly connected with the specified types of activity, and also any transactions for ensuring own economic needs of the insurer.

The insurers performing life insurance can grant the loans to the insurers who signed life insurance contracts.

The procedure, conditions of issue and loan amounts and procedure for forming of reserve for covering of possible losses are established by Authorized body.

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