Law No. 47 Of 15 July 1991 Concerning The Establishment, Organization And Operation Of Insurance Companies

Original Language Title:  LEGE nr. 47 din 16 iulie 1991 privind constituirea, organizarea şi funcţionarea societăţilor comerciale din domeniul asigurărilor

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LAW No. 47 of 15 July 1991 concerning the establishment, organization and functioning of the insurance company ISSUING the PARLIAMENT Published in MONITORUL OFICIAL NR. 151 of 19 July 1991 Parliament adopts this law.

Chapter 1 General provisions Article 1 In Romania, the insurance business is conducted by insurance companies, insurance undertakings-reinsurance and reinsurance companies, which assume their obligations through the acceptance of risks in Exchange for payment of premiums by the make or, where appropriate, reasigurati.
The insurance business is conducted through brokerage firms and referred to hereafter as intermediary agents who negotiate and conclude contracts of insurance and reinsurance undertakings referred to in paragraph 1. 1 times providing other services relating to the conclusion and execution of such contracts.

Article 2 establishment of insurance companies with foreign participation is done only through association with legal entities and individuals.

Article 3 insurance companies, referred to in art. 1 and art. 2, is constituted in the form of joint stock companies or limited liability companies.
Undertakings referred to in paragraph 1. 1 shall constitute and operate in compliance with the law on commercial companies and, where appropriate, of the law on the regime of foreign investments, as well as the provisions of the present law.

Article 4 foreign firms and associations representing foreign insurers may set up, in accordance with the law and in compliance with the following requirements: a) have legal personality in the country of origin, to be conducted in the field of insurance activity in the last 10 years and not be in a State of cessation of payments or bankruptcy, or other similar situations;

b) to deposit at a banking establishment from Romania, a cash security equivalent to the minimum limit prescribed capital to be paid up at the establishment of societies under the provisions of art. 8;

(c)) to obtain the opinion of the Office for the supervision of insurance and reinsurance activity of the Ministry of economy and finance.

Established representative offices in Romania, according to para. 1, can only conclude: a) contracts of insurance and reinsurance contracts with legal entities or natural persons, their property or goods;

(b) reinsurance contracts) with insurance companies, insurance-reinsurance undertakings and reinsurance undertakings.

Chapter 2 establishment, organization and operation of article 5 insurance companies shall be formed with the consent of the Office for the supervision of insurance and reinsurance activity of the Ministry of economy and finance.

Article 6 with a view to obtaining, accompanying applications, where appropriate, of the following documents: memorandum of justification, including an overview of the objects and its financial underpinnings, the draft Bylaw and statutory declarations in respect of capital subscribed and paid up and its structure.
Against unfavourable opinion, which will be motivated, applicants can make opposition to Minister of economy and Finance shall, within 15 days of receipt. The decision may be appealed to the Court of Bucharest within 30 days of receipt.

Article 7 insurance companies may engage in one or more classes of insurance and reinsurance, according to the objects set out in the contract and status.
For the purposes of paragraph 1. 1, are mainly the following categories of insurance: life insurance has);

(b)) other persons insurance than those of life;

(c) motor vehicle insurance);

d) marine and transport insurance;

e) aircraft insurance;

f) fire insurance and other damage to property;

g) liability insurance;

h) credit insurance and guarantees;

I) financial loss insurance from insured risks;

j) agricultural insurance.

Article 8 minimum Limit of capital subscribed to the formation of a society is: 25,000,000 lei), in the case of insurance undertakings, reinsurance undertakings, insurance-reinsurance undertakings, and separately for each of the classes of insurance specified in article 1. 7, which they practice;

b) in the case of 1,500,000 lei intermediary agencies.

The paid-up share capital at incorporation cannot be less than 50% of the subscribed capital.

Article 9 insurance firms carrying out the operations of insurance and reinsurance, usually in lei, and where payment assumes obligations in foreign currency, these operations shall be carried out in a foreign currency.
Payment for insurance transactions and goods for Romanian citizens who travel abroad is made in Moldovan lei.

Article 10 insurance undertakings and insurance undertakings-reinsurance practice and life insurance are obliged to keep separate accounts of that class of insurance, to manage related funds and make payments from such funds only for life insurance, setting the final results separately from other types of insurance.

Article 11 insurance companies, insurance companies and reinsurance companies-reassurance, annually can assume such obligations from insurance and reinsurance contracts corresponding to a volume of which, after deducting reinsurance premiums ceded, do not exceed a ceiling equivalent to up to five times the amount of paid-up share capital and capital reserves.

Article 12 in order to comply with the obligations which it Division take through the acceptance of risks, insurance undertakings-reinsurance and reinsurance companies may carry out disposal operations in reinsurance from other companies, in reciprocity or unilaterally, of parts of obligations under contracts concluded with make and reasigurati.

Article 13 insurance companies, insurance companies and reinsurance companies-reinsurance may conclude agreements concerning the co-insurance and other specific forms of cooperation, in order to ensure or reinsurance risks, which cannot be answered by a single company.

Article 14 brokerage Agencies cannot enter into contracts of insurance for insurance companies, with foreign legal entities or individuals for property owned by Romanian authorities of their times.

Article 15 insurance firms may be associated in unions may join the national and international professional bodies.

Chapter 3 technical reserves, prices, investments Article 16 insurance companies, insurance-reinsurance undertakings and reinsurance undertakings are obliged to be, according to their object, reserves of life insurance premiums, as well as stocks of raw materials and damage to other kinds of insurance and reinsurance.
Reserve for life insurance premium is determined based on actuarial calculations and is administered separately.
Premium reserves for other kinds of insurance and reinsurance consists of shares corresponding to the unexpired risks in the year in which they were first collected.
Reserves are based on damage estimates, statistical or actuarial calculations on payments to be made in the future. They may not be less than 40% of the difference between premiums and damages paid to reasigurarile insurance and valid throughout the year.
Reserves of damages, even if there are identifiable, may be pursued by make or lenders.
Insurance companies, insurance-reinsurance undertakings and reinsurance undertakings carrying out operations and foreign currency reserves and foreign currency in lei.
Premium amounts affected the reserve life insurance, as well as supplies of raw materials and other kinds of damage insurance and reinsurance, shall be deducted from income for the purposes of determining profits.

Article 17 insurance companies and insurance undertakings-reinsurance set out the requirements relating to voluntary insurance, respecting the provisions of the law relating to the insurance contract, as well as the rates of premiums for these insurances.
The reinsurance operations, conditions and the first shall be determined by the contract of reinsurance.

Article 18 intermediary Agencies establish commissions or fees that they charge for services, benefits, according to the agreed tariffs through contracts concluded with insurance companies, insurance-reinsurance undertakings and reinsurance undertakings.

Article 19 For the conclusion and performance of contracts of insurance, insurance companies and insurance undertakings-reinsurance insurance agents can use. Their remuneration is made with commissions from revenue or fees set according to tariffs agreed by contracts.

Article 20 insurance companies can capitalise on their own funds and those attracted by the work done on a temporary basis, in the form of income from interest for availability kept in banks or savings.
Insurance companies may invest a part of capital, capital reserves and technical reserves in securities, movable or immovable property, or you can use for granting credits institutions with Bank profile, respecting the liquidity coefficient, established according to the statutes.

Insurance firms with foreign participation and those who carry out the operations of insurance and reinsurance in Forex investments can be made under paragraph 1. 2, lei and foreign currency.

Chapter 4 Financial Year balance sheet article 21 shall begin on 1 January and ends on 31 December, except for the first year of activity, when it starts on the date of establishment of the company.

Article 22 insurance companies are required to submit, on an annual basis, the Office for the supervision of insurance and reinsurance activity, up to April 15 of the following year, balance sheet and profit and loss account approved by the general meeting of shareholders or members and accompanied by the auditor's report, if applicable.
Embassies and foreign companies are required to submit to the Office for the supervision of insurance and reinsurance activity, within the time limit referred to in paragraph 1. 1, annual financial statements, which it shall forward to the societies of the countries of origin.

Chapter 5 oversight of insurance Article 23 for the monitoring of the application of the legal provisions relating to insurance business, in order to prevent the State of insolvency of insurance companies and policyholders ' rights, set up the Office for the supervision of insurance and reinsurance activity within the Ministry of economy and finance.
The duties of the Office for the supervision of insurance and reinsurance activity shall be established by decision of the Government.

Article 24 insurance companies and insurance companies-reinsurance vehicle insurance practice will constitute the Bureau of motor vehicle insurance, which represents such companies in internal relationships and with domestic tasks and supervises, meets the achievement, by the companies represented, rezultind obligations of international conventions relating to insurance against civil liability for damage caused by motor vehicle accidents.

Chapter 6 article 25 Sanctions breach by insurance companies of the provisions of art. 10, art. 11, art. 14, art. 391. 1-4 and art. 22 paragraph 1. 1 constitutes contravention and shall be sanctioned with a fine of 10,000 lei to 150,000 lei.

Article 26 Violation by foreign companies and representative offices of foreign insurance associations of the provisions of art. "". 2(a) the a and b)) and art. 22 paragraph 1. 2 constitutes contravention and shall be sanctioned with a fine of 10,000 to 150,000 lei.

Article 27 the Actuaries and other professionals who, in carrying out their duties with regard to examining balance sheets, assets, investments, or other elements of heritage of the companies in the field of insurance, draw up reports with current sanctions offence fine of 5,000 lei lei, 75,000 where the acts committed do not meet the constitutive elements of a crime.

Article 28 Penalties provided for in article 4. 25-27 shall apply providing the authorized agent of the Office for the supervision of insurance and reinsurance activity.

Chapter 7 special provisions, final and transitory article 29(1) are exempt from taxes, stamp duty and any other taxes: the compensation amounts secured), and any other rights shall be granted from any kind of insurance;

b) transfers of values of investments and transfers of portfolios between insurance companies, insurance-reinsurance undertakings and reinsurance undertakings, the transferring company in a transfer to that heritage.

Article 30 the provisions of this law shall be completed with the legislation on civil, commercial and administrative.

The provisions of article 31 of this law shall not apply to mutual insurance cooperatives, mutual associations and mutual-aid societies or inmormintare.

Article 32 insurance companies, established before the entry into force of this law, they will be able to continue working if within 6 months it will reorganize in compliance with the provisions of this Act.

Article 33 this Act shall take effect within 30 days of its publication in the Official Gazette of Romania. On the same date shall repeal the Decree nr. 470/1971 on the Organization and functioning of the State Insurance Administration, as well as any other provisions to the contrary.
This law was adopted by the Senate at its meeting on 25 June 1991.
Academic SENATE PRESIDENT ALEXANDRU BÂRLĂDEANU this law was adopted by the Assembly of deputies at its meeting on 1 July 1991.
The PRESIDENT of the ASSEMBLY of DEPUTIES MARTIAN D under article 13. 82 lit. m) of Decree-Law No. 92/1990 to elect the Parliament and President, promulgăm law, organisation and functioning of insurance companies and we have its publication in the Official Gazette of Romania.
ROMANIAN PRESIDENT ION ILIESCU — — — — — — — — — — — — — — — — — — — — — — — — — —

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