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The document ceased to be valid since March 3, 2019 according to Item 2 of the Resolution of Board of National Bank of the Republic of Kazakhstan of January 31, 2019 No. 14

RESOLUTION OF BOARD OF NATIONAL BANK OF THE REPUBLIC OF KAZAKHSTAN

of May 27, 2015 No. 95

About approval of the Instruction about establishment of normative values and techniques of calculations of prudential standard rates of the Islamic insurance (reinsurance) organization and other regulations and limits, obligatory to observance

(as amended of the Resolution of Board of National Bank of the Republic of Kazakhstan of 30.05.2016 No. 127)

According to the laws of the Republic of Kazakhstan of March 30, 1995 "About National Bank of the Republic of Kazakhstan", of December 18, 2000 "About insurance activity", of March 19, 2010 "About the state statistics" the Board of National Bank of the Republic of Kazakhstan DECIDES:

1. Approve the enclosed Instruction about establishment of normative values and techniques of calculations of prudential standard rates of the Islamic insurance (reinsurance) organization and other regulations and limits, obligatory to observance.

2. To department of methodology of control and supervision (Abdrakhmanov N. A.) in the procedure established by the legislation to provide:

1) together with Legal support department (Dosmukhambetov N. M.) state registration of this resolution in the Ministry of Justice of the Republic of Kazakhstan;

2) the direction of this resolution on official publication in information system of law of Ad_let of the republican state company on the right of economic maintaining "The republican center of legal information of the Ministry of Justice of the Republic of Kazakhstan" within ten calendar days after its state registration in the Ministry of Justice of the Republic of Kazakhstan;

3) placement of this resolution on official Internet resource of National Bank of the Republic of Kazakhstan after its official publication.

3. To department of the international relations and public relations (Kazybayev A. K.) provide the direction of this resolution on official publication in periodic printing editions within ten calendar days after its state registration in the Ministry of Justice of the Republic of Kazakhstan.

4. To impose control of execution of this resolution on the vice-chairman of National Bank of the Republic of Kazakhstan Kozhakhmetov K. B.

5. This resolution becomes effective after ten calendar days after day of its first official publication.

Chairman of National Bank

K. Kelimbetov

It is approved

Chairman of Committee according to the statistics Ministries of national economy of the Republic of Kazakhstan

2015

 

 

A. Smailov

Approved by the Resolution of Board of National Bank of the Republic of Kazakhstan of May 27, 2015 No. 95

The instruction about establishment of normative values and techniques of calculations of prudential standard rates of the Islamic insurance (reinsurance) organization and other regulations and limits, obligatory to observance

1. General provisions

1. This Instruction about establishment of normative values and techniques of calculations of prudential standard rates of the Islamic insurance (reinsurance) organization and other regulations and limits, obligatory to observance (further - the Instruction) is developed for the purpose of implementation of the Law of the Republic of Kazakhstan of December 18, 2000 "About insurance activity" (further - the Law) and establishes normative values and technique of calculations of prudential standard rates of the Islamic insurance (reinsurance) organization and other regulations and limits, obligatory to observance.

For the purposes of the Instruction:

insurance premium the insurance premium is recognized Islamic insurance fund;

insurance reserve the insurance reserve created in Islamic insurance fund is recognized;

insurance payment the insurance payment performed from Islamic insurance fund is recognized;

asset the asset of the Islamic (reinsurance) organization and Islamic insurance fund is recognized;

the amount to obtaining from overcautious persons the amount to obtaining from overcautious persons created in Islamic insurance fund is recognized;

asset of reinsurance the reinsurance asset is recognized Islamic insurance fund.

2. Minimum size of the authorized capital of the Islamic insurance (reinsurance) organization

2. The minimum size of the authorized capital for again created Islamic insurance (reinsurance) organization constitutes:

in case of receipt of the license on industry "general insurance" - 1 100 000 000 (one billion hundred million) tenges;

in case of receipt of the license on industry "life insurance" - 1 200 000 000 (one billion two hundred million) tenges;

in case of receipt of the license on industry "general insurance" and licenses on Islamic reinsurance - 1 200 000 000 (one billion two hundred million) tenges;

in case of receipt of the license on industry "life insurance" and licenses on Islamic reinsurance - 1 300 000 000 (one billion three hundred million) tenges;

in case of receipt of the license on Islamic reinsurance with reinsurance implementation, as exclusive type of activity - 1 000 000 000 (one billion) tenges.

3. For again created Islamic insurance organization obtaining the license in industry "general insurance" on the class "mortgage insurance", the minimum size of the authorized capital constitutes 1 600 000 000 (one billion six hundred million) tenges.

3. The minimum size of margin of solvency for the Islamic insurance company performing insurance activity on industry "general insurance" and the Islamic reinsurance organization

4. The minimum size of margin of solvency for the Islamic insurance company performing insurance activity on industry "general insurance", and the Islamic reinsurance organization represents the size equal to the maximum value of one of the sizes calculated by the methods provided by Items 5 and 6 of the Instruction.

5. Procedure of payments of the minimum size of margin of solvency with use of "method of awards":

1) calculation is perfromed proceeding from the amount of the cumulative insurance premiums accepted under agreements of Islamic insurance (reinsurance) for the previous financial year, or the cumulative earned insurance premiums for the previous financial year from which for calculation the largest size is accepted;

2) the amount of the cumulative insurance premiums accepted by the Islamic insurance (reinsurance) organization on class of compulsory insurance of civil responsibility of owners of vehicles increases by 50 (fifty) percent;

3) the amount of cumulative insurance premiums (cumulative earned premiums) accepted under agreements of Islamic insurance (reinsurance) for the previous financial year decreases by expense amount on payment of remuneration for Islamic insurance activity, and also by the amount of the corporate income tax from the main activities;

4) the amount of the insurance premiums calculated according to subitems 1), 2) and 3) of this Item, in the amount of, not exceeding 1 500 000 000 (one billion five hundred million) tenges, is multiplied by 18 (eighteen) percent, the remained amount of excess is multiplied by 16 (sixteen) percent. The received results are summed up and adjusted on the correction coefficient calculated according to the subitem 5) of this Item;

5) the correction coefficient is calculated as the relation of the amount of cumulative insurance payments less the overcautious person's share in the insurance payments added for the previous three financial years to the amount of the cumulative insurance payments added for the previous three financial years. This relation cannot be less 0,5. If the size of the correction coefficient received as a result of calculation is less than 0,5, that for calculation 0,5 is accepted.

The correction coefficient is not applied when calculating the minimum size of margin of solvency of the Islamic insurance (reinsurance) organization if for the previous three financial years the Islamic insurance (reinsurance) organization did not perform insurance payments.

6. Procedure of payments of the minimum size of margin of solvency with use of "method of payments":

1) for calculation the amount of the cumulative insurance payments added for the previous three financial years is used;

for the Islamic insurance (reinsurance) organization which is engaged only in risks insurance, specified in subitems 13) and 14) of Item 3 of article 6 of the Law, for calculation the amount of cumulative insurance payments for the previous seven financial years is used;

2) the amount of the cumulative insurance payments performed by the Islamic insurance (reinsurance) organization on class of compulsory insurance of civil responsibility of owners of vehicles increases by 50 (fifty) percent;

3) the amount of cumulative insurance payments increases by the amount of reserve of the declared, but not settled losses for the end of the previous financial year, and decreases:

on the amount of reserve of the declared, but not settled losses for the end of financial year, in three years preceding accounting financial year;

for the Islamic insurance (reinsurance) organizations specified in the paragraph the second the subitem 1) of this Item, - on the amount of reserve of the declared, but not settled losses for the end of financial year, in seven years preceding accounting financial year;

4) for calculation of the minimum size of margin of solvency of the Islamic insurance (reinsurance) organization it is used:

the one third part of the amount specified in the paragraph the second the subitem 3) of this Item;

for the Islamic insurance (reinsurance) organizations specified in the paragraph the second the subitem 1) of this Item - the one seventh part of the amount specified subitem in paragraph three 3) of this Item;

5) the amount of insurance payments calculated according to subitems 1), 2), 3) and 4) of this Item, in the amount of, not exceeding 1 000 000 000 (one billion) tenges, is multiplied by 26 (twenty six) percent, the remained amount of excess is multiplied by 23 (twenty three) percent. The received results are summed up and adjusted on the correction coefficient calculated according to the subitem 5) of Item 5 of the Instruction.

If the Islamic insurance (reinsurance) organization did not perform insurance payments during the term specified in the subitem 1) of this Item, then calculation of the minimum size of margin of solvency is perfromed without use of "method of payments".

7. For the Islamic insurance (reinsurance) organizations accepting insurance premiums according to insurance contracts (reinsurance) on the class "mortgage insurance", the minimum size of margin of solvency increases by five percent from insurance sum on the insurance contracts (reinsurance) existing by the end of the reporting period on the class "mortgage insurance" less the overcautious person's share in insurance sum by the end of the reporting period.

According to the insurance contracts (reinsurance) on the class "mortgage insurance" signed by the Islamic insurance (reinsurance) organization with persons who according to article 26 of the Law are large members of the Islamic insurance (reinsurance) organization and also persons in whom Islamic insurance (reinsurance) has considerable participation or the being affiliated organizations according to article 32 of the Law, the minimum size of margin of solvency increases by 10 (ten) percent from insurance sum on the insurance contracts (reinsurance) existing by the end of the reporting period on the class "mortgage insurance" less the overcautious person's share in insurance sum by the end of the reporting period.

8. If the minimum size of margin of solvency of the Islamic insurance (reinsurance) organization for the accounting period is less, than for the previous financial year, then the minimum size of margin of solvency for the accounting period is equal to the minimum size of margin of solvency for the same period of last year corrected on coefficient of the reserve calculated according to Item 9 of the Instruction.

If the minimum size of margin of solvency for the same period of last year corrected on reserve coefficient is less than minimum size of margin of solvency for the accounting period, then for calculation the minimum size of margin of solvency for the accounting period is used.

9. The coefficient of reserve is calculated as the relation of the amount of reserve of the declared, but not settled losses minus the overcautious person's share for the end of the previous financial year to the amount of reserve of the declared, but not settled losses minus the overcautious person's share for the beginning of the previous financial year. This relation cannot be more than 1. If the size of the reserve coefficient received as a result of calculation more 1, that for calculation is accepted by 1.

4. The minimum size of margin of solvency for the Islamic insurance company performing insurance activity on industry "life insurance"

10. Calculation of the minimum size of margin of solvency is made for the Islamic insurance company performing activities in industry "life insurance" separately on classes and types of insurance:

1) on class of life insurance and annuity insurance;

2) by the form insurance, providing life insurance with participation of the insurer in investments of Islamic insurance company;

3) on class of accidents insurance and sickness insurance.

For calculation of the minimum size of margin of solvency of Islamic insurance company the amounts received according to Items 11, 15 and 16 Instructions are accepted.

11. Calculation of the minimum size of margin of solvency of Islamic insurance company for the insurance classes specified in the subitem 1) of Item 10 of the Instruction represents the size equal to the amount of the values calculated according to Items 12 and 14 of the Instruction.

12. The minimum size of margin of solvency according to life insurance contracts on death case according to which the capital under risk is not negative value, is equal to the amount of the following sizes:

1) according to life insurance contracts on death case (for up to 3 years) - 0, the % of capital sum under risk is multiplied by the correction coefficient calculated according to part two of Item 13 of the Instruction;

2) according to life insurance contracts on death case (from 3 (three) up to 5 (five) years) - 0,15 of % of capital sum under risk is multiplied by the correction coefficient calculated according to part two of Item 13 of the Instruction;

3) according to other life insurance contracts on death case - 0,3 of % of capital sum under risk is multiplied by the correction coefficient calculated according to part two of Item 13 of the Instruction.

13. The capital under risk represents the cumulative insurance sum according to current agreements of life insurance for the end of the previous financial year reduced by the amount of the created insurance reserves on them.

The correction coefficient is calculated as the capital relation under risk according to life insurance contracts on death case minus the overcautious person's share to the capital under risk. This relation cannot be less 0,5. If the size of the correction coefficient received as a result of calculation is less than 0,5, that for calculation 0,5 is accepted.

14. The minimum size of margin of solvency according to other insurance contracts on the classes specified in the subitem 1) of Item 10 of the Instruction is equal to the work of 4 (four) percent from the amount of the created insurance reserves and the correction coefficient calculated according to part two of this Item.

The correction coefficient is calculated as the relation of the amount of the created insurance reserves less the overcautious person's share in insurance reserves for the end of the previous financial year to the total amount of the created insurance reserves for the end of the previous financial year. This relation cannot be less 0,85. If the size of the correction coefficient received as a result of calculation is less than 0,85, that for calculation 0,85 is accepted.

15. The minimum size of margin of solvency for Islamic insurance company by the form of insurance "Life insurance with participation of the insurer in investments of Islamic insurance company" represents the value equal to the amount of the following sizes:

1) 4 (four) percent from the amount of the internal reserve fund calculated according to the resolution of Board of the Agency of the Republic of Kazakhstan on regulation and supervision of the financial market and the financial organizations of September 3, 2010 No. 134 "About approval of Rules of participation of the insurer in investments or profit of insurance company" registered in the Register of state registration of regulatory legal acts at No. 6540 (further - the resolution No. 134) under agreements under which the Islamic insurance company bears investment risk;

2) 1 (one) percent from the amount of the internal reserve fund calculated according to the resolution No. 134 under agreements under which the Islamic insurance company does not bear investment risk and on which the amount of means allocated for covering of administrative expenses is fixed;

3) 25 (twenty five) percent from the amount of administrative expenses for the previous financial year under agreements under which the Islamic insurance company does not bear investment risk, and on which the amount of means allocated for covering of administrative expenses is not fixed.

16. On classes of accidents insurance and sickness insurance the minimum size of margin of solvency is calculated according to Items 4, 5 and 6 Instructions.

5. Calculation of actual margin of solvency of the Islamic insurance (reinsurance) organization

17. The actual margin of solvency is calculated as the amount:

the paid authorized capital;

retained income of previous years (including funds, reserve of unforeseen risks, stabilization reserve, the reserves created at the expense of net income of last years) minus the dividends which are subject to payment;

behind minus:

intangible assets, except for the software acquired for the purposes of the main activities of the Islamic insurance (reinsurance) organization. The software acquired for the purpose of the main activities of the Islamic insurance (reinsurance) organization is accepted in the amount of its book value reflected in financial accounting of the Islamic insurance (reinsurance) organization for settlement date of actual margin of solvency and which is not exceeding 10 (ten) percent from assets of the Islamic insurance (reinsurance) organization;

uncovered loss of previous years;

uncovered loss of the accounting period;

investments into the capital of other legal entities.

18. The actual margin of solvency increases by the amount of subordinated debt in the amount which is not exceeding 50 (fifty) percent from actual margin of solvency or from the minimum size of margin of solvency (depending on what indicator is less). The subordinated debt with fixed maturity date in the amount does not exceed 50 (fifty) percent from the amount of subordinated debt.

19. The subordinated debt of the Islamic insurance (reinsurance) organization is unsecured obligation of the Islamic insurance (reinsurance) organization. The subordinated debt corresponds to the following conditions:

1) only completely paid amount of the money which is actually received by the Islamic insurance (reinsurance) organization is considered;

2) in case of liquidation of the Islamic insurance (reinsurance) organization it is satisfied according to priority, the stipulated in Clause 72 Laws;

3) it is settled (fully or partially) by the Islamic insurance (reinsurance) organization, including ahead of schedule only at the initiative of the Islamic insurance (reinsurance) organization provided that such repayment according to the conclusion of authorized body on regulation, control and supervision of the financial market and the financial organizations (further - authorized body) cannot lead to non-compliance by the insurance (reinsurance) organization with the prudential standard rates established by the Instruction subsequently;

The repayment period of subordinated debt with fixed maturity date constitutes 4) at least five years. At least in one year prior to repayment date the Islamic insurance (reinsurance) organization represents to authorized body the plan of providing actual margin of solvency at the time of repayment. This requirement does not extend to cases when the subordinated debt joins in calculation of actual margin of solvency in the following procedure:

during term more than five years prior to debt repayment - in full amount of debt within five years which remained prior to debt repayment:

The 1st year - 100 (hundred) percent of the amount of subordinated debt;

The 2nd year - 80 (eighty) percent of the amount of subordinated debt;

3rd year - 60 (sixty) percent of the amount of subordinated debt;

The 4th year - 40 (forty) percent of the amount of subordinated debt;

The 5th year - 20 (twenty) percent of the amount of subordinated debt;

5) in case of repayment of the subordinated debt which does not have fixed maturity date, the Islamic insurance (reinsurance) organization at least in five years prior to expected repayment period represents the plan of providing actual margin of solvency to authorized body. This requirement does not extend to cases when the subordinated debt does not join the Islamic insurance (reinsurance) organization in calculation of actual margin of solvency, and also in case of its early repayment. In this case the Islamic insurance (reinsurance) organization receives the decision of authorized body on early repayment of subordinated debt in six months prior to expected repayment date, previously having provided the plan of providing actual margin of solvency before such repayment;

6) the subordinated debt is not subject to repayment in dates, excellent from approved with authorized body, except for liquidations of the Islamic insurance (reinsurance) organization;

7) change of conditions of subordinated debt is performed only in the presence of the consent of authorized body.

20. The actual margin of solvency is provided with the assets calculated according to Item 26 of the Instruction, reduced by the amount of insurance reserves minus share of the overcautious person and obligations, except for insurance reserves.

If the actual margin of solvency is not provided with the amount of assets calculated according to part one of this Item, then the actual margin of solvency is constituted by difference between the assets calculated taking into account their classification by quality and liquidity minus insurance reserves and obligations, except for insurance reserves.

6. Minimum size of guarantee fund

21. The minimum size of guarantee fund for the Islamic insurance (reinsurance) organizations constitutes at least following sizes:

for the Islamic insurance company having the license on industry "general insurance" - 600 000 000 (six hundred million) tenges;

for the Islamic insurance company having the license on industry "life insurance" - 1 100 000 000 (one billion hundred million) tenges;

for the Islamic insurance company having licenses on classes in voluntary form of insurance, specified in subitems 9), 10), 11), 12), 13), 14) and 15) Item 3 of article 6 of the Law, and to any of classes in obligatory form of insurance, - 1 000 000 000 (one billion) tenges;

for the Islamic reinsurance organization performing reinsurance as exclusive type of activity - 780 000 000 (seven hundred eighty million) tenges.

The minimum size of guarantee fund for the Islamic insurance (reinsurance) organizations decreases by 10 (ten) percent if the share of obligations on the class specified in the subitem 2) of Item 3 of article 6 of the Law constitutes more than 90 (ninety) percent in total amount of obligations of the Islamic insurance (reinsurance) organization on reporting date.

22. For the Islamic insurance company having the license in industry "general insurance" on the class "mortgage insurance", the size of guarantee fund constitutes at least 1 500 000 000 (one billion five hundred million) tenges.

7. Standard rate of sufficiency of margin of solvency and guarantee fund

23. If the minimum size of margin of solvency is less than minimum guarantee fund, then the minimum size of margin of solvency constitutes the size equal to the minimum guarantee fund.

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