Circular 37/2019/TT-NHNN insurance agency activities of credit institutions and foreign bank branches for insurance enterprises

CIRCULAR

Guiding insurance agency activities of credit institutions and foreign bank branches for insurance enterprises^[1]

Pursuant to the June 16, 2010 Law on the State Bank of Vietnam;

Pursuant to the June 16, 2010 Law on Credit Institutions; and the November 20, 2017 Law Amending and Supplementing a Number of Articles of the Law on Credit Institutions;

Pursuant to the December 9, 2000 Law on Insurance Business; the November 24, 2010 Law Amending and Supplementing a Number of Articles of the Law on Insurance Business; and June 14, 2019 Law Amending and Supplementing a Number of Articles of the Law on Insurance Business and Law on Intellectual Property;

Pursuant to the Government’s Decree No. 73/2016/ND-CP of July 1, 2016, detailing a number of articles of the Law on Insurance Business and Law Amending and Supplementing a Number of Articles of the Law on Insurance Business; the Government’s Decree No. 80/2019/ND-CP of November 1, 2019, amending and supplementing a number of articles of the Government’s Decree No. 73/2016/ND-CP of July 1, 2016, detailing a number of articles of the Law on Insurance Business and Law Amending and Supplementing a Number of Articles of the Law on Insurance Business; and the Government’s Decree No. 98/2013/ND-CP of August 28, 2013, on sanctioning of administrative violations in the fields of insurance and lottery, which had a number of articles amended and supplemented under the Government’s Decree No. 48/2018/ND-CP of March 21, 2018;

Pursuant to the Government’s Decree No. 16/2017/ND-CP of February 17, 2017, defining functions, tasks, powers and organizational structure of the State Bank of Vietnam;

At proposal of the Chief of the Banking Supervision Agency;

The Governor of the State Bank of Vietnam promulgates the Circular guiding insurance agency activities of credit institutions and foreign bank branches for insurance enterprises.

Chapter I

GENERAL PROVISIONS

Article 1. Scope of regulation

This Circular guides insurance agency activities of credit institutions and foreign bank branches for life insurance, non-life insurance, health insurance and reinsurance enterprises and branches of foreign non-life insurance enterprises (below collectively referred to as insurance enterprises).

Article 2. Subjects of application

1. Credit institutions (excluding policy banks) and foreign bank branches (below collectively referred to as credit institutions).

2. Organizations and individuals involved in insurance agency activities of credit institutions for insurance enterprises.

Article 3. Principles of insurance agency activities of credit institutions

1. A credit institution must satisfy conditions for, and comply with provisions on, insurance agency activities for insurance enterprises prescribed in the law on insurance business.

2. A credit institution may not use collected insurance premiums for any purposes other than those agreed upon in an insurance agent contract.

3. Insurance agency activities of a credit institution shall be stated in a license granted to the credit institution by the State Bank of Vietnam.

Chapter II

SPECIFIC PROVISIONS

Article 4. Insurance agency activities of credit institutions

Insurance agency activities of credit institutions for insurance enterprises include one or more than one of the following activities:

1. Customer recommendation:

A credit institution may recommend customers who wish to purchase insurance to an insurance enterprise for it to offer insurance products.

2. Insurance offer:

A credit institution may directly offer, and explain terms and conditions of, insurance products to customers who wish to purchase insurance; or offer insurance products by electronic methods or other methods in accordance with law.

3. Arrangement of the conclusion of insurance contracts:

A credit institution shall guide and support its customers in making insurance contracts, receive insurance claim dossiers, and arrange the conclusion of insurance contracts in accordance with agreements in the insurance agent contract and the law on insurance business.

4. Collection of insurance premiums:

A credit institution shall collect insurance premiums from customers on behalf of an insurance enterprise as agreed upon in the insurance agent contract.

5. Settlement of indemnity claims and payment of insurance money upon the occurrence of the insured event:

A credit institution shall support and guide its customers to carry out procedures for claiming settlement of insurance benefits, and receive customers’ dossiers claiming indemnities or insurance money and transfer them to the insurance enterprise for appraisal and issuance of decisions on payment of indemnities or insurance money. If being authorized by the insurance enterprise, the credit institution shall pay indemnities or insurance money to the customers.

6. Other activities related to the performance of insurance agent contracts in accordance with the law on insurance business and as authorized by insurance enterprises.

Article 5. Insurance agent contracts

1. An insurance agent contract shall be made in writing in accordance with the law on insurance business and other relevant laws.

2. An insurance agent contract must have the principal contents prescribed by the law on insurance business and agreements on information provision and crosscheck and payment of insurance premiums between insurance enterprises and credit institutions.

Article 6. Rights and obligations of credit institutions in insurance agency activities

1. Credit institutions have the rights of insurance agents as provided by the law on insurance business.

2. Credit institutions have the obligations of insurance agents as prescribed by the law on insurance business and the following obligations:

a/ To explain to their customers that insurance products distributed via credit institutions are not products of credit institutions;

b/ To manage and retain lists of their employees directly conducting insurance agency activities for insurance enterprises as agreed upon in insurance agent contracts;

c/ To provide insurance enterprises with adequate and accurate information on collected insurance premiums, paid insurance benefits and other payments as agreed upon in insurance agent contracts;

d/ To transfer all collected insurance premiums to insurance enterprises after subtracting insurance agent commissions, paid insurance benefits and other payments as agreed upon in insurance agent contracts;

dd/ To fully and accurately provide to and crosscheck with insurance enterprises necessary customer information which they are obliged to collect as prescribed in Article 7 of this Circular.

Article 7. Information provision and crosscheck

1. Customer information shall be provided in accordance with the law on confidentiality and provision of customer information of credit institutions.

2. Credit institutions shall provide insurance enterprises with at least following information:

a/ For customer recommendation and insurance offer: Name, age, gender, address, phone number and email of an individual customer; or name, address, phone number, email and contact person of an institutional customer;

b/ For arrangement of the conclusion of insurance contracts: Information related to an insurance buyer and the insured, and information necessary for appraisal before deciding on issuance of an insurance contract;

c/ For collection of insurance premiums: List of customers having paid insurance premiums and total collected premiums;

d/ For settlement of indemnity claims and payment of insurance money upon the occurrence of insured events as authorized by insurance enterprises: List of payable indemnities, payable insurance sums and dossiers claiming indemnities or insurance sums.

3. Credit institutions shall, at least once a month as agreed upon in insurance agent contracts, cooperate with insurance enterprises in crosschecking information on new insurance contracts, insurance premiums collected, changes in valid insurance contracts, and information related to settlement of indemnity claims and payment of insurance money upon the occurrence of insured events they have conducted.

Article 8. Reporting regime

On the 25^th of the last month of a quarter, credit institutions shall submit directly or send by post reports on insurance agency activities of credit institutions for insurance enterprises, made according to the form provided in the Appendix to this Circular, to the State Bank of Vietnam (via the Banking Supervision Agency, for those prescribed in Clause 1, Article 9 of this Circular, or via the State Bank’s provincial-level branches, for those prescribed in Clause 2, Article 9 of this Circular). Data provided in such reports shall be taken from the 15^th of the month preceding the reporting quarter to the 14^th of the last month of that quarter.

Chapter III

IMPLEMENTATION PROVISIONS

Article 9. Responsibilities of the Banking Supervision Agency and the State Bank’s provincial-level branches

1. The Banking Supervision Agency shall inspect and supervise insurance agency activities of credit institutions, except the case prescribed in Clause 2 of this Article.

2. The State Bank’s provincial-level branches shall inspect and supervise insurance agency activities of credit institutions based in their localities and subject to their micro-prudential inspection and supervision.

Article 10. Effect

This Circular takes effect on March 2, 2020.

Article 11. Organization of Implementation

The Chief of the Office, Chief of the Banking Supervision Agency, and heads of units of the State Bank of Vietnam, directors of the State Bank’s provincial-level branches, and chairpersons of the Boards of Directors or Members’ Councils, and directors general (directors) of credit institutions shall organize the implementation of this Circular.-

For the State Bank Governor
Deputy Governor
NGUYEN THI HONG

* The Appendix to this Circular is not translated.