RESOLUTION OF BOARD OF NATIONAL BANK OF THE REPUBLIC OF KAZAKHSTAN

of December 19, 2015 No. 240

About approval of Rules of calculation of the coefficients characterizing unprofitability (unprofitability coefficient, cost ratio, the combined coefficient) of the insurance (reinsurance) organization, branch of the insurance (reinsurance) nonresident organization of the Republic of Kazakhstan

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

1. Approve the enclosed Rules of calculation of the coefficients characterizing unprofitability (unprofitability coefficient, cost ratio, the combined coefficient) of the insurance (reinsurance) organization, branch of the insurance (reinsurance) nonresident organization of the Republic of Kazakhstan.

2. Recognize invalid regulatory legal acts of the Republic of Kazakhstan according to appendix to this resolution.

3. To department of supervision of subjects of the insurance market (Kaliyev A. E.) 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.

4. 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.

5. To impose control of execution of this resolution on the vice-chairman of National Bank of the Republic of Kazakhstan Smolyakov O. A.

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

Approved by the Resolution of Board of National Bank of the Republic of Kazakhstan of December 19, 2015 No. 240

Rules of calculation of the coefficients characterizing unprofitability (unprofitability coefficient, cost ratio, the combined coefficient) of the insurance (reinsurance) organization, branch of the insurance (reinsurance) nonresident organization of the Republic of Kazakhstan

These rules of calculation of the coefficients characterizing unprofitability (unprofitability coefficient, cost ratio, the combined coefficient) of the insurance (reinsurance) organization, branch of the insurance (reinsurance) nonresident organization of the Republic of Kazakhstan (further - Rules) are developed in compliance by the Law of the Republic of Kazakhstan of December 18, 2000 "About insurance activity" and determine procedure of payments of the coefficients characterizing unprofitability (unprofitability coefficient, cost ratio, the combined coefficient) of the insurance (reinsurance) organization, branch of the insurance (reinsurance) nonresident organization of the Republic of Kazakhstan.

The requirements of these rules applied in relation to the insurance (reinsurance) organizations extend to branches of the insurance (reinsurance) nonresident organizations of the Republic of Kazakhstan.

1. General provisions

1. In Rules the following concepts are used:

1) the accounting period – twelve months preceding reporting date;

2) net spendings on payment of commission fee - expenses on payment of commission fee for insurance activity less the commission fees received from the overcautious person;

3) the commission fees earned from the overcautious person - the commission fees earned from the overcautious person, added in the accounting period, increased by the size of the postponed commission fees from the overcautious person for the beginning of the accounting period and reduced by the size of the postponed commission fees from the overcautious person by the end of the reporting period;

4) the suffered losses without the overcautious person's share – net amount of payments, expenses on settlement of insurance losses, and also net amount of changes in reserves of losses;

5) expenses on payment of commission fee for insurance activity - the expenses on payment of commission fee for insurance activity added in the accounting period, increased by the size of the postponed commission expenses for the beginning of the accounting period and reduced by the size of the postponed commission expenses by the end of the reporting period;

6) expenses on settlement of insurance losses – expense amount of the insurance (reinsurance) organization of the expert, consulting or other services suffered for payment connected with assessment of the size and decrease in damage (harm) caused to valuable interests of the insurer which arose in connection with insured events;

7) net reserve of not earned premium - reserve of not earned premium without the overcautious person's share;

8) net spendings – net spendings on payment of commission fee, total and administrative expenses, and also the other expenses corresponding to the similar items of expenses provided in appendix 10 to the Rules of accounts presentation by the financial organizations approved by the resolution of Board of National Bank of the Republic of Kazakhstan of January 28, 2016 No. 41, registered in the Register of state registration of regulatory legal acts at No. 13504 (further – the resolution No. 41);

9) net amount of payments - the amount of insurance payments without share of the overcautious person and less compensation according to the recourse requirement;

10) authorized body - the state body performing regulation, control and supervision of the financial market and the financial organizations;

11) the suffered losses - insurance payments, expenses for settlement of insurance losses, and also change in reserves of losses;

12) net amount of changes in reserves of losses – changes in reserves of losses without the overcautious person's share;

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