CIRCULAR guide the establishment, organization and operation of the insurance organization reciprocity in the field of agriculture, forestry and fisheries _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ pursuant to the law on insurance business no. 24/2000/QH10 on 9 December 2000;
Pursuant to Decree No. 42/2001/ND-CP of July 8, 2001 detailing the Government's implementation of some articles of the law on insurance business;
Pursuant to Decree No. 18/2005/ND-CP dated 24 February 2005 of the Government regulating the establishment, organization and operation of the insurance organization reciprocity;
Pursuant to Decree No. 77/2003/ND-CP dated 1/7/2003 of government functions, tasks, powers and organizational structure of the Ministry of finance;
In order to meet the insurance needs of institutions and individuals active in the field of agriculture, forestry, fisheries and the dwellers living and working in rural areas, remote areas; to stabilize and develop the industry, the airline industry and the lives of low income people, the Ministry of Finance shall guide the establishment, organization and operation of the insurance organizations active in the field of mutual insurance in agricultural, forestry and fisheries as follows: i. GENERAL PROVISIONS 1. Principles of organization and activity of the insurance institutions of insurance institutions reciprocity reciprocity is organized and operates according to the following principles: 1.1. Mutual insurance organization is the organization with legal personality established for insurance business aim, mutual help among members is organizations, individuals active in Vietnam along a field, industry or live on the same location and with the same type of risk. Name of mutual insurance must show clearly the nature of and to have the term "mutual insurance", abbreviated as "BHTH".
1.2. members of organized reciprocity insurance is the buyer of insurance is the owner of the insurance organization.
1.3. The members of the Organization were reciprocity insurance have the right to participate in management, inspection and monitoring activities of the insurance organization.
1.4. automatic reciprocity insurance organization responsible for the results of business activities within the capital and its property.
2. Field of activity and content insurance organization 2.1 reciprocity. Insurance services insurance organizations allowed reciprocity business insurance services: 2.1.1. Health insurance and personal accident insurance;
2.1.2. Property insurance and insurance losses;
2.1.3. insurance of goods transported by road, sea, River, rail, and air;
2.1.4. motor vehicle insurance;
2.1.5. Fire insurance;
2.1.6. the ship hull insurance and civil liability of ship owners;
2.1.7. General liability insurance;
2.1.8. Credit insurance and financial risks;
2.1.9. the damage insurance business;
2.1.10. agricultural insurance.
2.2. the customer object insurance institutions insurance allowed reciprocity for the following object: domestic and foreign enterprises in all economic sectors, institutions, households and individuals active in the same field, industry (production, processing, aquaculture, transport, distribution, circulation , providing services and conducting other business activities in the field of agriculture, forestry, fisheries), insurance needs, there are benefits that can be covered and have the same kind of risks attached to or derived from the field, that trades.
2.3. Object of insurance the insurance object is the property; the liability of the insured person to third person; life, accident and health of the insured person. Specifically the following: 2.3.1. Insurance object is the property of plants, animals, materials, goods and materials; factories, machinery, equipment, tools, labour; transport service for production, cultivation and processing, circulation; the products of agriculture, forestry, fishery.
2.3.2. the insurance object of liability is the liability of the insured person against third persons according to the regulations of the law arises in the field of agriculture, forestry, fisheries and rural life.
2.3.3. The object of insurance is life, accident and health of the people involved in the production, cultivation, processing, provide services, circulation and consumption of products in the fields of agriculture, forestry, fishery.
2.4. geographical operations based on business plans, active content and financial capability, organization, organization of mutual insurance can operate within a province, a number of provinces, or national scope as defined in the license to establish and operate.
3. The Charter of the Organization of mutual insurance 3.1. The Charter of the Organization of insurance must have sufficient reciprocity to the contents specified in article 14 of Decree 18/2005/ND-CP on 24/02/2005 of the Government regulating the establishment, organization and operation of insurance organizations.
3.2. The mechanism of voting of members stipulated in the Charter of the Organization of mutual insurance must ensure equitable principles, publicity, democracy.
3.3. mutual insurance organizations must report the Ministry of finance when the additional amendments.
II. INSURANCE MEMBERSHIP RECIPROCITY 1. Founding member of the insurance organization 1.1 reciprocity. As for the founding members of the individual workers, household, motor vehicles, transport inland waterways, the home base of production, cultivation, processing, circulation and consumption of products in the fields of agriculture, forestry, fishery meets the conditions below have the right to join the insurance organization established reciprocity as the Members: 1.1.1. Vietnam citizens from 18 years of age;
1.1.2. Have the capacity for civil acts in full;
1.1.3. Do save the criminal responsibility or in jail or criminal courts deprived of the right to practise because of violations of the criminal provisions of the law;
1.1.4. active in the same fields, professions and have the same kind of risks attached to or derived from the field, that profession;
1.1.5. the insurance needs, there can be benefits coverage for the risks attached to or derived from the field, profession of the founders;
1.1.6. Has committed in writing to the Organization's insurance covered reciprocity soon after this organization was granted a license to establish and operate.
1.2. With respect to the founding members of the corporate organization is established and operating under the enterprise law, law on State enterprises, the law on cooperatives and associations, Association, Association of industries, agriculture, farms, the Centre meet the conditions below have the right to participate in the mutual insurance organization as founding member : 1.2.1. Established and legitimate activities in Vietnam in the field of production; providing materials, services; processing, circulation and consumption of agricultural products, forestry, and fishery in accordance with the law;
1.2.2. Activities in the same fields, professions and have the same kind of risks attached to or derived from the field, the above mentioned professions;
1.2.3. Are in healthy financial status;
1.2.4. the insurance needs, there can be benefits coverage for the risks attached to or derived from the field, profession of the founders;
1.2.5. Has committed in writing to the Organization's insurance covered reciprocity soon after this organization was granted a license to establish and operate.
2. members of the Organization of insurance 2.1 reciprocity. Members of the insurance organization reciprocity is the Organization, individuals are eligible for contracts covered under the provisions of the law and have insurance contracts with the insurance organization.

2.2. The membership organization of mutual insurance is determined by the base to buy insurance in the insurance contract. In this case, an Organization stands out to buy insurance for the members of that organization, then the organization is regarded as a member insurance organization.
2.3. When concluding the insurance contract with the members, in addition to the information relating to the contract of insurance is provided under the provisions of the law, the insurance organizations cỏn reciprocity must provide members with information related to the insurance organization.
2.4. Unless the Charter reciprocity or insurance institutions insurance contracts have other rules, rights and obligations of insurance organizations membership reciprocity ended with the termination of the membership of that organization.
III. LICENSE The ESTABLISHMENT And OPERATIONS Of INSURANCE ORGANIZATION RECIPROCITY 1. Conditions to be granted a license to establish and operate 1.1. Capital levels not lower the level of capital as defined in point 1.1, paragraph 1 Item V of this circular;
1.2. application for a license to establish and operate according to the provisions in clause 2 of this circular section III;
1.3. are there areas of expected activities and content consistent with the provisions in paragraph 2 of section I of this circular;
1.4. Charter consistent with the provisions of article 10, Decree No. 18/2005/ND-CP dated 24 February 2005 of the Government regulating the establishment, organization and operation of the insurance organizations and the other relevant regulations of the law;
1.5. The administrator, who has the capacity, expertise, professional: 1.5.1. Chairman of the Management Board of the insurance organization reciprocity must be reputable, professional ethics and management experience.
1.5.2. The Director (ceo) of the insurance organization reciprocity must be reputable, professional ethics, have business management practices or the administration of insurance for at least 10 years and are resident in Vietnam in the current time.
1.6. Number of founding members not less than 10 members.
2. Application for a license to establish and operate a license application for establishment and operations of insurance organization reciprocity as defined in article 11, Decree No. 18/2005/ND-CP dated 24 February 2005 of the Government regulating the establishment, organization and activities of the Organization include reciprocity insurance documents : 2.1. Application for license under the form prescribed in annex I attached to this circular. Application for a license must be signed by the legal representative or person is authorized by the founding members;
2.2. active projects first 5 years in which clearly the method of extracting the backup set, the program of re-insurance, capital investment, business efficiency, solvency of insurance organizations and the economic benefits of the creation of this organization;
2.3. list, biographies, the diplomas are certified capacity, expertise, business administrators, who runs mutual insurance organization;
2.4. Verification of the legitimacy of the establishment capital insurance organization, financial and other information related to the individual, organization founder;
2.5. Rules, terms, fees, insurance commissions of the kind expected insurance products business;
2.6. The draft statute includes the main content are specified in article 14 of Decree 18/2005/ND-CP dated 24 February 2005 of the Government regulating the establishment, organization and operation of the insurance organizations and in accordance with the provisions of the relevant legislation;
2.7. The minutes of the meeting of founding members on the establishment of insurance organization reciprocity;
2.8. the Agency's verification authority on the legal capacity of the founders: 2.8.1. In respect of the founding member's organization: a copy of the decision to establish the Organization, the business registration certificate.
2.8.2. for founding member is personal: curriculum vitae confirmed by the competent bodies.
2.9. the authoritative text for the representatives of the founding members.
Application for a license by reciprocity insurance organization was formed into 3 (three) in which there is 1 (one) is a major, 2 (two) is a copy. The founding members are responsible for the accuracy of the application for license.
3. procedures for receiving and handling 3.1 license application. Application for license by the Ministry of finance received and checked on the basis of the following: 3.1.1. The header text needs to be in the profile as specified in clause 2 of this circular section III;
3.1.2. The validity of the application for license;
3.1.3. The text confirm legal status, the legitimacy of the establishment capital insurance organization.
3.2. within 60 days of the receipt of the full application for license, the Ministry of Finance decided to permit or deny licensing. In case of refusal to grant a licence, the Ministry of finance have text explaining the reason.
In the process of evaluation of application for license, within 15 working days from the date of receipt of the item the documents prescribed in paragraph 2 in section III of this circular, the Ministry of finance can send notifications requires additional founding members, modify records , if necessary.
The time limit for the founding members submitted additional documents, modify the application for license is 30 working days from the receipt of a written request of the Ministry of finance. Most of the additional time, modify the application for license, including the grace period, if the founders don't complete the record as requested, the license application review thereafter.
3.3. License granted according to the form prescribed in annex II attached to this circular.
3.4. The evaluation license application for establishment and operations of insurance organization reciprocity made prevailing legal regulations applicable to the types of business insurance.
4. license fee within 7 days from when it was granted a license to establish and operate the insurance organizations, reciprocity in licensing fees as specified in annex II, circular No. 110/2002/TT-BTC on 12 December 2002 the main guide currency , submission, management and use of fees and charges in the field of banking, securities and insurance.
5. The change to approval procedures approved changes according to the provisions of article 69 of law on insurance business was made specifically as follows: 5.1. Rename the insurance organization: coverage organization reciprocity reciprocity would like to change the name to submit to the Finance Ministry proposed the name change because the text representation before the law or the authority of the Organization and documents of the Agency, individuals have the authority of the insurance organization reciprocity regarding the name change;
5.2. Increase or decrease the level of capital formation of the insurance organization.
Mutual insurance organizations want to change capital levels are sent to the Ministry of Finance: 5.2.1. A explanation of the adjustment increase and decrease the level of capital signed by the representative before the law or the authority of the Organization, which clearly a capital increase (or decrease), the reason the increase (or decrease), capital projects and the time taken;
5.2.2. the Award of financial resources used to raise capital in the event of capital increases.
5.3. open or to terminate the activities of a branch, representative office in 5.3.1. Records suggest open branches, representative offices of insurance organization reciprocity is made according to the provisions of article 11 and article 12 of Decree 42/2001/ND-CP of the Government on 01/08/2001 detailing the implementation of some articles of the law on insurance business.

5.3.2. The profile recommended the termination of activity of representative office, branch organization of mutual insurance include: a) the proposed text termination of activity;
b) reported the situation to the operations of a branch, representative office in 3 years. The case of a branch, Representative Office works not yet 3, then the active situation report from the start of operations;
c) responsibilities and problems arise upon the termination of the operation.
5.4. Change location to put headquarters, branches, representative offices of insurance institutions insurance institutions reciprocity reciprocity would like to change the set point headquarters, branch, his representative office must send to the Finance Ministry suggested text change location headquartered , the Organization's branch result insurance representative before the law or the person duly authorized by the insurance organization signed reciprocity.
5.5. Changing the content, scope and duration of the operation procedures and records suggest change the content, scope and duration of activity of the insurance organization reciprocity is made according to the provisions of article 10, Decree No. 42/2001/ND-CP of the Government on 01/8/2001 detailing the implementation of some articles of the law on insurance business.
5.6. Change of Chairman of the Board, General Director (Director) 5.6.1. Within the time limit at the latest 15 days before the text of appointment, dismissal or periodically between States the Chairman of the Board, General Director (Director), insurance organization Director-General (Executive Director), Chairman of the Board or who is Chairman of the Board is authorized to have text sent the Finance Ministry proposal approved of the change.
5.6.2. The records suggest change of Chairman of the Board, General Director (Director) include: a) to approve the proposed text changes;
b) expected appointment, dismissal of employees of the insurance organization reciprocity;
c) biographies of people expected to be appointed to the confirmation of the Board or person authorized by the insurance organization reciprocity;
d) diploma, certificate of proof of professional competence and qualifications of the President of the Board, General Director (Managing Director) appointed expected;
DD) the minutes of the meeting on the appointment, dismissal of the Chairman of the Board, General Director (Director) insurance organizations, if available.
5.7. Split, split, merger, amalgamation, dissolution, conversion forms of insurance organizations.
Records, procedures and time limit for resolving a request to split, split, merger, amalgamation, dissolution, conversion forms of organized reciprocity insurance is done according to the instructions of the Ministry of finance and the provisions of relevant laws.
5.8. The time limit for settling the requests approved changes in the time limit of 30 days from the day the Finance Ministry received full approval recommendation profile change of organization of insurance regulation from reciprocity points 5.1 to 5.5 account 5 Item III of this circular, the Ministry of finance have written answer on the approve or refuse to approve the proposal of insurance organizations reciprocity. In case of refusal must clearly state the reason in writing.
In case of approval, the Finance Ministry approved in writing with respect to the change in point 5.4 and 5.6 or permit adjustment for insurance organization reciprocity according to the form prescribed in annex III attached to this circular with regard to changes in point 5.1, 5.2, 5.3, 5.5. and 5.7. License adjustment is an integral parts of the establishment and operations of insurance organizations.
IV. EXPLOITATION Of Insurance, REINSURANCE And PRECAUTIONS, Limiting The LOSSES Of 1. Exploit coverage 1.1. Registration rules, terms, the premiums of insurance products: 1.1.1. The registration rules, terms, insurance fees are applicable to the products covered are specified in paragraph 3 Article 18 Decree No. 42/2001/ND-CP of the Government on 01/8/2001 detailing the implementation of some articles of the law on insurance business.
1.1.2. the insurance organizations registered only reciprocity rules, terms, premiums for insurance products in the insurance profession is business regulation in the license to establish and operate by the Ministry of finance granted to insurance organizations.
1.1.3. insurance mutual organization is responsible for the content and legality of rules, terms, the premiums of insurance products registered with the Ministry of finance.
1.1.4. When registration rules, terms, costs of insurance products, insurance institutions must submit to reciprocity the Ministry of finance the following documents: a) the suggested text registered insurance products according to the form prescribed in Appendix V attached herewith;
b) rules, terms, costs of insurance products expected to apply.
1.1.5. within 3 working days from receipt of registration materials full rules, terms, costs of insurance, the Ministry of finance is responsible for confirming the insurance organizations have completed the registration procedure rules, terms, premiums.
1.1.6. In case of need change, additional rules, terms, costs of insurance products were registered with the Ministry of finance, mutual insurance organizations must register the change, supplemented under the procedure defined in point 1.1.4 clause 1 section IV of this circular. With regard to the particular risks or not mentioned in the rules, terms, premiums have registered with the Ministry of finance, the insurance institutions and mutual insurance is allowed to deal on the insurance conditions, premiums to cover the risk and make the product registration procedure after concluding the contract.
1.2. Approves the insurance products 1.2.1. Before you deploy the product to health insurance and personal accident insurance, mutual insurance organisations must submit the Finance Ministry proposal approved profile products including the following: a) text approved by Ministry of finance proposals before applying;
b) rules, terms, fees, Insurance Commission of insurance products expected to deploy;
c) formulas, methods and explain the basis of charging, backup of business insurance products expected to deploy.
1.2.2. within 30 days from the date of receipt of a valid application specified in the aforesaid points, the Finance Ministry must reply in writing the approval or denial of approval. In case of refusal of approval, the Finance Ministry must have text explaining the reason.
2. insurance 2.1 Commission. Insurance commissions of the Organization's expenses are covered for reciprocity business insurance brokers, insurance agents. Mutual insurance organization only pays commissions from the insurance premiums fact obtained under Commission rate specified in this circular.
2.2. mutual insurance organizations are actively using the Insurance Commission for the content of the following costs: 2.2.1. Pay directly for insurance agents, insurance brokerage business after the Organization, this individual brings services to the insurance organization reciprocity in order to offset the following expenses:-cost of initial mining (learn, convince and customer referrals);
-The cost of the insurance fee;
-The cost of tracking contracts and convince customers to maintain insurance contracts.
2.2.2. The genus Insurance Commission to serve for the management agent includes:-expenses management agents who are not employees of the enterprise;
-Encourage mining agents beyond the norm of revenue, of the number of insurance contracts, ensure retention rate high insurance contract;
-Cost to implement some welfare policy and create conditions for a stable income for the agent.

2.2.3. Commission rate the maximum insurance coverage organizations reciprocity is allowed to pay for insurance agents are made according to the table of the Insurance Commission rate applies to each insured services are defined in Appendix IV-Table Commission rate coverage applies to the casualty insurance business attached to this circular.
2.2.4. insurance commissions for insurance contracts are calculated using the total amount of commissions of each risk covered in the contract of insurance.
2.2.5. Commission rate insurance brokers is determined on the basis of agreement between the insurance institutions and mutual insurance brokerage business consistent with the law of Vietnam and international customs. Depending on the scope, level and content insurance brokerage service offered, the insurance broker commissions are charged to 15% of the actual premiums earned.
3. Operation 3.1 reinsurance. Regulations on reinsurance 3.1.1. Mutual insurance institutions are not the entire reinsurance liabilities got coverage for one or more insurers, mutual insurance organization or for insurance organizations overseas to reinsurance brokerage Commission.
3.1.2. mutual insurance institutions are only allowed to retain maximum liability levels on each of the risks or on each individual losses not exceeding 10% of the total capital. The section responsible for in excess of the 10% rate on the say to reinsurance.
3.2. Regulation of reinsurance insurance organizations can receive reciprocity liability reinsurance that insurers, mutual insurance organizations have received coverage consistent with the content and scope of the insurance organization. Upon re-insurance, mutual insurance organizations must evaluate the risks in order to ensure consistent with their financial ability.
4. the insurance regulations on insurance agents insurance organization of reciprocity is made in accordance with the current rules on insurance agents and relevant legislation.
5. Transfer of contract of insurance regulations on the transfer of the insurance contract of the insurance organization reciprocity is done according to the current rules on transfer policy and relevant law.
6. Precautions, limiting the losses of 6.1. Mutual insurance organizations is not more than 2% of the actual premium revenue in the fiscal year to spend on precautionary measures, restrict the loss specified in paragraph 2, article 25 of Decree 42/2001/ND-CP on 01/08/2001 detailing the Government's implementation of some articles of the law on insurance business.
6.2. proposed Expenditure, limiting the losses of the insurance organization reciprocity are to follow strictly the regulations on financial management of enterprises and relevant legislation.
V. Financial, ACCOUNTING 1. Capital 1.1. The level of capital the insurance organizations of reciprocity is 20 billion. Level of own capital of the mutual insurance organisations active in the field of agriculture is 9 billion.
1.2. within 15 days from the date the licensed establishment and operation, the insurance organization reciprocity must complete the establishment of the capital contribution to the level not lower the level of capital specified in point 1.1 paragraph 1 V to this circular.
1.3. During the process of operation, the insurance organization reciprocity must always maintain a level of capital not lower the level of capital specified in point 1.1 paragraph 1 V to this circular. If due to any cause whatsoever that capital formation decreased to lower the level of capital specified in point 1.1 paragraph 1 V to this circular, the mutual insurance institutions are established for replenishment of capital not lower the level of capital specified in point 1.1 paragraph 1 V to this circular.
2. Deposit 2.1. The Organization's insurance escrow reciprocity is made according to article 34 of Decree 18/2005/ND-CP on 24/02/2005 of the Government regulating the establishment, organization and operation of insurance organizations.
2.2. mutual insurance organizations just used funds to pay insurance indemnity and insurance according to the commitments in the contract of insurance with the members when the solvency deficit and the Finance Ministry must be approved in writing. Within a period of 90 days of use of funds, mutual insurance organization responsible for supplementary funds were used.
2.3. mutual insurance institutions are withdrawing the whole deposit when the termination of activities.
3. Preventive Services 3.1. Mutual insurance institutions must establish the types of preventive services as defined in article 35 of Decree 18/2005/ND-CP on 24/2/2005 of the Government regulating the establishment, organization and operation of insurance organizations.
3.2. mutual insurance institutions are allowed to choose and register with the Ministry of Finance set the extract method of backup insurance professional according to the instructions in point 3.4 account 3 V to this circular, or other methods to extract backup set of other business caution and the Ministry of finance approved in writing before applying.
3.3. mutual insurance institutions are not change the method to extract backup insurance business establishment in the financial year. In case of changing the method of extract formed professional backup insurance for the next financial year, the insurance organization reciprocity is proposal and approved by Ministry of finance in writing before applying.
3.4. Methods of extracting the backup setting the Organization's insurance business insurance reciprocity: 3.4.1. Reserve unearned fees: calculation of unearned premium reserve is applied according to the approach taken to retain fees of 2 (two) last month for the insurance business of goods transported by road, sea, River, rail and 40% of the total costs of retaining all the remaining insurance operations in a fiscal year.
3.4.2. Redundancy compensation: how to calculate the quote level established compensation reserve are applied according to statistical methods.
3.4.3. the compensation reserve for the range of losses: how to calculate the level of extract formed reserve range are applied according to statistical methods and extracted set every year until reserves the large oscillations by 100% of real costs hold back in the fiscal year of the insurance organization.
4. mandatory reserve fund and the Voluntary Fund 4.1. Mutual insurance organizations to establish a compulsory reserve fund to guarantee payment ability. Obligatory reserve funds be taken annually by the rate of 5% of profits after tax. The maximum level of the mandatory reserve fund equal to 10% of the level of capital formation of the insurance organization.
4.2. In addition to the mandatory reserve fund specified in point 4.1 paragraph 4 V to this circular, the insurance institutions can mutually established voluntary funds from profit after tax of financial year with conditions to be stipulated in the Charter of the Organization of insurance.
5. surplus insurance organizations Fund reciprocity surplus funds as specified in 10.1.3 account scores 10 V to this circular for use for the following purposes: 5.1. Cover the costs when the company was unable to pay;
5.2. the accrued capital to strengthen the financial capacity of insurance institutions and other purposes in accordance with the Charter of the Organization of mutual insurance and in accordance with the provisions of the law;
6. capital investment the investment capital of the insurance organization reciprocity must ensure safe, efficient and fulfill the claim often for commitment under the insurance contract.
6.1. capital investment in mutual insurance organization include: 6.1.1. Capital formation;
6.1.2. the mandatory reserve fund;

6.1.3. the surplus Fund and other funds from profit (if any);
6.1.4. the idle capital from insurance business prevention;
6.2. the idle capital from professional backup coverage insurance organization of reciprocity is the total insurance business excluding the funds that held mutual insurance refers to the insurance compensation often in the States. Funds used to regular insurance compensation in the period not lower than 25% of the total forecast of business insurance and sent in the credit organizations operating in Vietnam.
6.3. the idle capital investment from business backup coverage insurance organization of reciprocity specified in point 5.2 paragraph 5 V to this circular are only investing in Vietnam in the following areas: 6.3.1. Buy government bonds, corporate bonds have the guarantee, deposit money in credit organizations without restriction;
6.3.2. Buy stocks, corporate bonds have no guarantee, capital contribution to other businesses 35% maximum idle capital from redundancy insurance business;
6.3.3. the real estate business, loans, investment trust through financial institutions-credit maximum 20% idle capital from insurance business backup.
6.4. The investment from the capital reserve fund, other funds and surplus funds are formed from profits made under the provisions of the law.
7. The solvency of the insurance organizations 7.1 reciprocity. Mutual insurance organization must always maintain liquidity during the insurance business activities. Mutual insurance institutions are deemed to have sufficient liquidity when set aside the full professional backup as specified in clause 3 V to this circular and have the ability to pay does not lower the minimum solvency margins under the rules.
7.2. minimum solvency Margins of mutual insurance organization in 20% of the total real premiums withheld at the time of determining solvency margins.
For example, at the time of determining solvency margins, mutual insurance organization A has of retaining the premium is 50 billion in Vietnam. Minimum solvency margins of insurance organization reciprocity A = 50 billion Vietnam x 20% = 10 billion Vietnam Dong.
7.3. The minutes of the Organization's payment ability insurance reciprocity is the difference between the value of assets and liabilities of the insurance organization. The following property will not be included in calculating the solvency margins of organized reciprocity: the insurance capital to establish other insurance business from the source organization's equity mutual insurance;
The debt does not have the ability to recover under the provisions of current legislation;
The reward Fund, the benefits (if any).
8. restore the solvency of the insurance organization to reciprocity in the case of risk of loss of liquidity insurance organizations, reciprocity must implement the following measures: 8.1. Plans to restore liquidity, strengthen the Organization and operation of the insurance organization, reported the Ministry of finance and the implementation plan was approved by the Ministry of finance;
8.2. Making the request of the Ministry of Finance on solvency restoration.
8.3. Control over the insurance organization reciprocity risk losing liquidity 8.3.1. In cases of non-reciprocity insurance organization restored the ability of payment according to the approved plan, the Ministry of finance decision established the Control Board payment capabilities to apply measures to restore the solvency of the insurance organization.
8.3.2. solvency Control Committee has the following duties and powers: a) directs and oversees the implementation of measures to restore solvency under schemes already approved;
b) inform the relevant State bodies about adopting measures to restore solvency to coordination;
c) limit the scope and activities of mutual insurance organization;
d) to suspend these activities can lead to mutual insurance organizations lose their ability to pay;
DD) Organization of insurance required reciprocity full transfer of an insurance contract or certain insurance for insurers, mutual insurance organization;
e) temporarily suspended the right to Executive, management and insurance organizations request reciprocity replacing members of the Board, General Director (Director), Vice President (VP) if it deems necessary;
g) requires the Board, ceo (Director) dismissed, suspended ties with those violations of the law, not a recovery plan Executive ability to pay has been approved;
h) recommendations to the Ministry of finance to continue or terminate the measures restore solvency;
I) Ministry of finance report on the application and the results of the application of measures to restore solvency.
8.3.3. solvency control Boards must take responsibility for its decisions in accordance with the law in the process of applying measures to restore the solvency of the insurance organization.
8.4. the insurance organization responsible for reciprocity made the request, the decision of the Board of supervisors the ability to pay.
8.5. The termination of the application of measures to restore solvency 8.5.1. The application of measures to restore the ability to terminate the payment in the following cases: a) the expiry of measures to restore solvency;
b) operation of mutual insurance organization back to normal;
c) insurance institutions have been merged, the merger before expiry of measures to restore solvency;
d mutual insurance organizations) in bankruptcy.
8.5.2. The termination of the application of measures to restore the ability of payment be made at the discretion of the Minister of finance. This decision is notified to the relevant authorities.
9. The revenue and expenditure of the Organization 9.1 mutual insurance. Revenue: 9.1.1. Sales of mutual insurance organizations include: a) revenue from business operations: insurance premium Revenue, the fee to receive reinsurance; reinsurance commissions revenue, costs of Agency services include assessment of losses, considering compensation, request reimbursement of third person, handle every 100% compensation; charge independence move minus the account to pay for rising currency as: refund of insurance premium reduction; reinsurance fees, refunds get reinsurance, reinsurance accepted fee reduction; the Commission completed the reinsurance; rising reinsurance commissions.
b) turnover of the financial activity: Currency investment activities as specified in clause 5 of this circular V; revenues from securities trading activities; collecting interest on the money deposited; property rental income; Enter the complete backup balance securities discounts and other financial activities revenues under the provisions of the law.
c other operating income): Currency from selling concessions, liquidation of fixed assets; the debts already clear now recovered; breach of contract fine revenue and other revenues prescribed by law.
9.1.2. The principle of determining turnover: a) revenue from insurance business is the amount receivable arising in the period is determined according to the following principles: mutual insurance organization-accounting original premium revenues on income when incurred liability insurance of insurance organization with respect to reciprocity membership of the Organization as specified in article 15 of law business insurance, namely:

+ Mutual insurance organization on accounting income when the insurance contract was allocated between insurance organizations and their members or have proof of insurance organizations have accepted the insurance and members of the Organization have insurance premiums.
 + Mutual insurance organizations have agreed for their members are owed premiums. In this case the mutual insurance organization must still accounting to revenue funds for members of the debt even though members have not premium.
+ Mutual insurance organisation deals with its members the premiums by States (each corresponding to a financial year of the insurance contract lasts for many years). In this case, the insurance organization accounting reciprocity on the turnover corresponding to the States or the States premium has arisen, not accounting on the premium part income yet to States members must file charges as agreed.
-For the remaining revenues: organize insurance accounting reciprocity on turnover of just when economic activity arises, there is evidence of approval of payments, irrespective of the parties has or has not obtained the money.
-For the account must spend to reduce currency: Organization of insurance accounting reciprocity on falling revenues as soon as economic activity arises, there is evidence of approval of the parties, regardless of whether the costs paid.
b) turnover of the financial activity: is the amount of revenue generated in the fiscal year.
c other operating income): is the full amount of the sale of goods and services after the minus (-) the account sales discounts, sales bounced back (if there are valid vouchers) are approved by the customer, irrespective of the payment has been obtained or not obtained money.
The proceeds of the insurance organization reciprocity arises in the States on the basis of invoices or vouchers valid and must be a full accounting of revenues.
9.2. Costs: 9.2.1. The cost of the insurance organization reciprocity is the must read, must extract arise in States including: a) the cost of insurance business activities:-the original insurance compensation; genus receive reinsurance compensation when the insurance event occurred according to the commitments in the insurance contract, the contract minus reinsurance receivables to reduce spending as: currency indemnity reinsurance, currency demanded reimbursement of third person, collecting the goods treated, 100% compensation;
-Extract business establishment as defined in clause 3 V to this circular;
-The Insurance Commission as prescribed in clause 2 section IV of this circular;
-The assessment of losses;
-Costs of Agency services include assessment of losses, considering compensation, request reimbursement of the third person;
-100% compensation order processing;
-Management of insurance agents;
-Prevent, limit losses as defined in clause 6 section IV of this circular;
-Risk assessment of subjects covered include expenses for information gathering, investigation, assessment of the insurance object;
-Salaries, wages, bonuses, retrenchment and the nature of salary, remuneration in accordance with the law;
-Social insurance, medical insurance are charged according to the rule of law;
-Other expenses under the provisions of the law.
b) costs of financial activities is spent in the fiscal year include:-costs for investment activities as specified in clause 5 of this circular V;
-Cost to rent property;
-Procedure of Bank loan interest;
-Quote discount backup stock;
-Other Expenditure under the provisions of the law.
c) other operating expenses is spent in the fiscal year include:-hefty Spending on sale, liquidation of fixed assets;
-Costs for the recovery of debts is already clear now recovered;
-Fines due to breach of contract;
-Other Expenditure under the provisions of the law.
Mutual insurance institutions are not in accounting costs the following:-the fines which the collective, the individual must file due to violation of the law;
-Expenses for basic construction, procurement of fixed assets, the difficulty for aid workers, support organizations, individuals in accordance with the law;
-Expenses, career rewards, benefits, subsidies often difficult, irregular and other items due to a different funding source coverage;
-No other reasonable expenses as prescribed by the law.  
10. Divide the profit 10.1. Profit after tax of mutual insurance organizations to be used for the following purposes: 10.1.1. Extract the required reserve fund set up under the provisions of the law;
10.1.2. Extract other voluntary funds established by the insurance organization reciprocity;
10.1.3. the profit after tax after it has extracted the mandatory reserve funds and the other voluntary funds were used to extract the surplus funds.
11. The obligation to pay tax and contributions to the State budget organization the mutual insurance are obliged to pay tax and contributions to the State budget according to the provisions of the tax law.
VI. REPORTING MODE 1. The report must make insurance organization responsible for reciprocity and submit financial reports, statistical reports, business reports in accordance with the current legislation.
1.1. financial reports: 1.1.1. Mutual insurance organization made financial settlement and full observance of the regulations on financial statements, prepare and submit to the Agency the State financial, statistical agencies, tax authorities under the provisions of the current law.
1.1.2. annual financial statements of mutual insurance organisations must be independent audit Organization confirmed.
1.2. the statistical report, business report: mutual insurance organization made up and submitted to the Ministry of finance the reported statistics, quarterly business report and in particular the following: 1.2.1. Premium revenue report: according to annex VI 1.2.2. The insurance compensation reports: according to Appendix VII 1.2.3. Report the Commission payment insurance: according to Appendix VIII 1.2.4. The report quoted established professional backup: according to Appendix IX 1.2.5. Investment activity report: according to Appendix X 1.2.6. Solvency reports: according to annex XI (reciprocity only insurance organizations implement annual report).
1.3. System report monitoring targets: report the monitoring indicators system according to decision No 153/2003/QD-BTC dated 22 September 2003 by the Minister of Finance on issuing the monitoring indicator system of insurance business. Mutual insurance organization must prepare and submit financial report Sets targets of surveillance system along with the financial report.
1.4. quarterly report: insurance organizations to establish reciprocity and send the slowest is 30 days from the end of the quarter.
1.5. Reporting years: mutual insurance organization must prepare and submit the Finance Ministry at the latest 90 days after the end of the financial year.
2. test, inspection of the implementation of the financial mode 2.1. The Board, the Director-General (Executive Director) insurance organization reciprocity have accountability financial related issues at the request of the State Agency when performing State management functions under the provisions of the law.
2.2. mutual insurance organization responsible for the accuracy, the integrity of the financial statements. Financial examination is conducted in the forms of: 2.2.1. Check periodically or irregularly;
2.2.2. To check each of the topics as required by financial management.
2.3. mutual insurance organizations violating the financial regime of the State will be dealt with according to the provisions of the law.
VII. PUBLIC INFORMATION GOODS INSURANCE ORGANIZATION Of RECIPROCITY 1. Mutual insurance organization must make public disclosure of accurate, timely information for members as prescribed by law and are responsible for the accuracy of the information has been published in accordance with the law.

2. At the latest within a period of 120 days from the end of the financial year, the insurance organization reciprocity must publish the financial statements have been audited, including the following specific information: 2.1. The business results of the fiscal year revenue, profit, the General Reserve Fund, the total amount of compensation;
2.2. Capital Reserve Fund, the surplus fund and other voluntary funds;
2.3. the refund amount (both principal and interest) in the year and have to pay of the loans to capital formation;
2.4. the Director-General (Executive Director), Chairman of the Board.
3. The disclosure of information is done through the mass media.
VIII. Monitoring, testing, INSPECTION and HANDLING VIOLATION 1. The implementation of monitoring, testing, inspection of the observance of the provisions of the law on the insurance business activities of mutual insurance institutions are made according to the provisions of the relevant laws.
2. The processing of the Organization's breach of reciprocity in the field of insurance the insurance business is done in accordance with Decree No. 118/2003/ND-CP dated 13/10/2003 of the Government sanctioning administrative violations in the field of insurance business and the provisions of relevant laws.
IX. IMPLEMENTATION 1. This circular has the effect after 15 days from the Post Gazette.
2. During the implementation process, if there are difficulties and obstacles, the proposal reflects the timeliness of the Finance Ministry to consider and resolve.