Insurance updates

Brazil

New legislation for acceptance of retrocession
  • Brazil
  • September 05 2017

The National Council of Private Insurance recently submitted for public consultation a draft regulation on the acceptance of retrocession by insurers and its intermediation. Among other things, the draft regulation allows insurers to accept retrocession risks from foreign reinsurers not registered with the Superintendence of Private Insurers (SUSEP) through foreign reinsurance brokers also not registered with the SUSEP, provided that the local insurer is authorised to operate in the lines of risks accepted.

New regulation for D&O insurance policies
  • Brazil
  • June 27 2017

The Superintendence of Private Insurance recently published Circular 553, which establishes new general guidelines on civil liability insurance policies for directors and officers, replacing the existing regulations on this matter. The new regulation, albeit flawed, has been welcomed by the market, as the previous D&O regulations did not reflect market practices.

Commitment agreement for change in conduct – TCACs
  • Brazil
  • May 16 2017

The Brazilian Insurance Agency (SUSEP) recently published a circular to provide regulated companies (ie, insurers, reinsurers and private pension companies) with the possibility of entering into a commitment agreement for a change in conduct (known under the acronym 'TCAC' in Portuguese) with SUSEP. While TCACs are not a new instrument, the circular allows the parties to enter into an agreement establishing a reasonable period in which to change or adjust the company's conduct.

New insurance bill raises concerns
  • Brazil
  • March 28 2017

A new bill aimed at replacing the Brazilian insurance law will soon be submitted to the Senate and a new insurance law is likely to be enacted in 2017. In general, the bill is exceedingly protectionist towards insureds and so overly detailed that it creates a framework of rules that is confusing and conflicts with other existing laws and regulations not only of an insurance nature, but also of a civil procedure one (eg, the Arbitration Act and the Consumer Defence Code).

New rules for D&O insurance policies
  • Brazil
  • January 17 2017

Superintendence of Private Insurance (SUSEP) Circular 541/2016 establishes general guidelines applicable to directors' and officers' insurance policies in relation to insurers' right to make direct payments to a third party, defence cost coverage and fines and contractual and administrative penalties. Although the new rule is an improvement, it has been much criticised by the insurance market and there has been a recent plea to SUSEP to suspend the rule's effects.


Canada

Department of Finance Canada launches consultation process reviewing federal financial sector framework
  • Canada
  • October 18 2016

The Department of Finance Canada recently announced the launch of the first of a two-stage consultation process on the federal financial sector legislative and regulatory framework. In this first stage of the process, the department is seeking input on the trends that are highlighted in the paper, the implications of these trends and the areas where action is possible and desirable.


Chile

Risk-based capital of insurers
  • Chile
  • June 13 2017

The securities and insurance regulator (SVS) recently published for comment the fifth version of its methodology for determining the risk-based capital of insurers. The latest version ‒ as well as the conceptual bases developed by the SVS for analysis, discussion and improvement ‒ includes a number of changes from the previous version and will be subject to public consultation until July 31 2017.


China

Contributed by AnJie Law Firm
Increased insurance investment limits further liberalise insurance industry
  • China
  • January 16 2018

Following the resumption of bilateral trade treaty talks between China and the United States, a 100-day plan was mooted which promised to improve trade ties going forward. One area of focus in this regard has been the foreign ownership limits that apply to inbound investment in Chinese financial services groups, including those pertaining to the country's insurance industry. This policy shift has given rise to expectations that further foreign investment in the insurance industry will increase significantly.

China 2020: world's largest insurance market and foreign insurers' strategies
  • China
  • November 14 2017

China's shift towards a knowledge-based digital economy is fuelling growth in the insurance sector, which aligns with the government's plan to double the rate of insurance penetration by 2020. By this date, insurance premium income is expected to have reached Rmb4.5 trillion. If this aim is achieved, China will have usurped the United States to become the world's largest insurance market, which bodes well for overseas insurers looking to participate in the domestic market.

The rise of insurtech in China
  • China
  • October 31 2017

A new wave of 'insurtech' companies (ie, insurers engaging with online distribution models and tech companies foraying into insurance) are recognising the gains to be made by entering into this emerging market. However, these developments by no means spell the end of the larger, more traditional Chinese insurers, which are adapting their longer-term business development strategies in response.

Cyber-insurance: a closer look
  • China
  • August 29 2017

Recent ransomware attacks across the globe have once again brought to the fore the all-encompassing enterprise risk management challenge that cyber-risks present to corporations. The raft of operational consequences of such an attack present an ever-burgeoning opportunity for insurers to expand further into this potentially lucrative new line of business. This is particularly pertinent in China, where there has been a shift towards increasing digitisation and automation in various high-tech industries.

Upcoming regulations for investors in insurers
  • China
  • June 06 2017

The regulations concerning investment limits and the required qualifications for shareholders that want to invest in Chinese insurers continue to be a focal point for potential investors. The China Insurance Regulatory Commission recently published the Administrative Measures for Equities of Insurance Companies (Draft for Comments), which make fundamental changes to the existing regulatory framework.


Finland

New insurance claim based on same traffic accident not time barred
  • Finland
  • July 04 2017

In 2006 a claim was filed pertaining to a traffic accident in which the claimant had fallen off a moped and suffered a severe brain injury. The insurer rejected the claim in 2007. In 2011 the claimant discovered that the brain injury had caused permanent incapacity and a new insurance claim was filed, which the insurer rejected. The Supreme Court recently had to consider whether the exacerbation of damage starts a new period for a claim if it has already become time barred.

New Motor Liability Insurance Act enters into force
  • Finland
  • February 28 2017

The new Motor Liability Insurance Act recently entered into force. The previous act dated from 1959 and required complete reform and modernisation to respond to existing and future needs. The new act is structured to follow the typical chronology of the underwriting and claims handling process and aims to promote competition by giving the insurance industry the opportunity to develop new products. This appears to be succeeding, as insurers have already launched new products.

Validity of legal expenses insurance
  • Finland
  • December 20 2016

The validity of legal expenses insurance can be problematic when ending business activities. A pharmacist terminated his legal expenses insurance after he retired and ended his business activities. Some time later he received a workers' compensation claim from a former employee. The pharmacist believed that the insurance would cover the matter, but the insurer rejected the claim because the event had occurred after the validity of the insurance.

Insurer's right to terminate cancer insurance
  • Finland
  • August 23 2016

The Financial Ombudsman Bureau recently issued a number of recommendations pertaining to insurers' rights to terminate cancer insurance policies, following on from its 2014 recommendations pertaining to the amendment of cancer insurance premiums and conditions. The recommendations reiterate that insurers cannot amend insurance contracts or terminate unprofitable contracts unless they draft the conditions carefully at the outset and fulfil their duty to inform.

New insurance claim for same traffic accident not time barred
  • Finland
  • June 14 2016

In a recent appeal case the claimant discovered that an accident had caused permanent incapacity after the claimant had filed an insurance claim, which had been rejected. The claimant hence filed a new claim, which was rejected on the basis that it was time barred. However, the court held that the right to compensation is not time barred and that the insurer had to handle the new claim because the accident's effects had manifested after its first decision.