State regulation of insurance activity in the Russian Federation
In the process of establishing social institutions in the Russian Federationgreat attention was paid to the regulation of insurance activities. This is due to the high level of social significance of this type of work. The occurrence of an insured event can harm the entire national economy. State regulation of insurance activities occurs through reporting, checking the compliance of information with actual results and regulatory regulation.
State regulation and supervisioninsurance activities are divided into preliminary, current and subsequent. In the first case, it is about checking the compliance of companies with the requirements under which a license is issued, registration of insurers. The current supervision is to check compliance with the legislation by market participants: analysis of reporting, revocation of licenses, exclusion of brokers from the register, etc. More detailed they will be considered further.
State legal regulation of insuranceactivity is carried out by the Law of the Russian Federation «About the organization of insurance business» and the Ministry of Finance. It applies to professional market participants, their intermediaries and beneficiaries.
Goals, functions, tasks
Objectives of state regulation of insurance activities:
- ensuring the stable functioning of the market;
- observance by the subjects of normative acts;
- ensuring the fulfillment of obligations by the parties to the transaction;
- protection of the domestic market from foreign companies;
- transfer to the state of taxes and fees.
Directions of state regulation of insurance activity:
- the adoption of laws and regulations, monitoring their compliance with government agencies;
- regulation of the insurers' solvency and ensuring fulfillment of their obligations;
- control over the payment of taxes by market participants;
- imposing sanctions on market participants.
Supervisory bodies perform such functions:
- issue a license to conduct business;
- make entries in the State Register of Insurers and Brokers;
- control the formation of tariffs;
- establish rules for the allocation of reserves, accounting records of transactions;
- develop normative and methodical documents;
- develop and submit proposals on the development of the legislative framework.
The rights of state inspection bodies
- Receive from insurers, reporting on activities, from their clients and banks - information about the financial situation.
- To carry out checks on the compliance of the information provided and the real financial situation.
- In case of violations by companieslegislative requirements to give instructions on the elimination of problems. If they are not met, then suspend the licenses until the violations are completely eliminated.
- Apply to the court with a claim for the liquidation of the insurer and companies operating without licenses.
In the world practice in this area, a regular audit of insurance companies is carried out. In Russia, this issue is still at the stage of consideration.
State regulation of activitiesinsurance companies on their solvency and financial sustainability consists in the calculation of tariffs for certain services, the formation of reserves, the evaluation of investment projects. Insurers annually assess the commitments made. Its results are reflected in a separate conclusion, which is transmitted to the state agency.
The absence of an established audit system is negativeis reflected in the entire industry. The methods of forming reserves quickly become obsolete, but are rarely revised. Steps to implement the audit are built only at the legislative level, but the goals, objectives, program and mechanisms are not defined in practice.
On the Russian market there are state andregional associations of insurers. They are formed according to the types of activity: medical, auto insurance, etc. Such unions are a resource of market self-regulation. Their main task is connected with the preparation of proposals for legislative acts, the formation of protection funds, the development of rules and programs, the methodological support of activities, the training of personnel, and so on.
The Union for the Protection of ConsumersThe Russian Federation. Its main task is to identify unscrupulous companies, protect consumer interests, develop rules, insurance programs, etc.
The activities of the unions on both sides should be carried out in cooperation. Taking into account the interests of insurers and their clients is an important prerequisite for the development of the market.
Insurance contracts are complex documents withlegal point of view. A person without a special education is difficult to understand all the formulations. In Western countries, state regulation of insurance activities for transactions with individuals is much more stringent than under contracts with legal entities. The latter can attract qualified lawyers to determine the compliance of the terms of the document with normative acts.
In the regions of the Russian Federation, state regulationinsurance activities are carried out by local supervisory authorities. Within their capabilities, they are assisted by the tax service, the Central Bank and the antimonopoly cabinet. In most countries in Europe, a single system for supervision is used. In Canada, some aspects are regulated by federal bodies, and the main powers are transferred to local authorities in the province. There is no global state regulation of insurance activity in the USA. Each state has its own rules.
State regulation of insuranceactivities when using the public system is that companies should report on the results of activities in public publications and provide supervisory authorities. Consumers of services can, on this information, compose an idea of the organization and decide on the expediency of concluding a contract.
This is a liberal system. A person without special education can not understand the financial statements. The interests of persons who have concluded contracts before the insurer has problems, are not insured in any way. State control over the execution of transactions is not carried out.
The regulatory system of regulation is,that the state additionally establishes the same requirements for all organizations engaged in insurance activities. They can be associated with financial security (compliance of the size of the capital with the obligations assumed), forms of ownership of insurers, the timing of reporting, etc. If these requirements are not met, sanctions are imposed on companies. This scheme has long and successfully operated in the UK, and has recently appeared in the EU.
Features of state regulationinsurance activity in the system of material supervision is that insurers publish reports on the results of their activities, and supervising authorities monitor compliance with the terms of contracts, the size of rates, the procedure for the formation of reserves. In theory, this scheme of activity respects the interests of all parties to the transaction, and there is no price dumping. In this way, state regulation of insurance activities in the Russian Federation is carried out.
The material system is broader than the normativenumber of objects covered. Its main principle is that all actions must be previously agreed with the state authorities. On the one hand, such a system severely limits the activities of insurers. Companies that develop a new product must approve it in supervisory bodies. The loss of time will be reflected in the lost profit. On the other hand, the interests of consumers of services are protected.
In the Russian Federation, the Ministry of Finance issues a license for carrying out insurance activities. To receive it, you need to form and pay the authorized capital, depending on the chosen type of activity:
- minimum 25 thousand minimum wages - all services except life insurance;
- minimum 35 thousand minimum wages - all types of insurance;
- more than 49 thousand minimum wages - only life insurance.
Within these limits, the funds must be transferred in cash. Above these values, contributions are taken in the form of property, use rights, the results of intellectual activity, and so on.
In addition, you need to submit the following documents to the Ministry of Finance:
- constituent documents (charter, minutes of the meeting, extract from the state register).
- payment for transfer of funds to the authorized capital account;
- business case;
- rules of insurance, sample forms of contracts;
- calculation of tariffs with detailed interpretation of the methodology used;
- data on the leader and his deputies.
As an economic justification, it is accepted:
- annual business plan;
- plan for reinsurance in case the maximum risk liability is more than 10% of own funds;
- algorithm for the formation of reserves and a plan for their placement;
- balance sheet, statement of financial results.
The decision to issue a license to the supervisory authority acceptswithin 60 days after receiving the documents. The basis for refusal can be not compliance of documents with legislative requirements. The state body informs the legal entity in writing about this.
State regulation of insurance activity in the Russian Federation is carried out in three stages: preliminary, current and subsequent. Let's consider each of them in more detail.
First, there is a selection among companies that want to get a license. Not every organization can carry out insurance activities.
The admission to the market can be carried out by twoways. In the first case, the company simply registers in the insurer's register, after which it can start operating. Such a clear admission is inherent in the system of publicity.
If a concessionary method is used, then the authoritiesSupervision must issue a license to carry out activities. It is necessary to provide documents confirming the possibility of meeting financial requirements. It is this scheme that is used in most countries of the world.
State authorities analyzeaccounting, management reporting. In case of necessity, additional data is requested. Also in their competence is the consideration of applications with proposals, complaints, the implementation of inspections. That is, the state regulation of the insurance activity of an insurance organization is reduced to timely assess the financial capabilities of the company for the risks, check the rules for the formation of reserves, compliance of the availability of funds with the established standards.
At this stage, decisions areinsurers, the performance of which does not meet any requirements (sanation, liquidation). State regulation of insurance activities in the Russian Federation at this stage is to minimize the losses of customers of unscrupulous companies. Supervisors may impose restrictions on the conclusion of new contracts, change tariff rates, adjust activities on other aspects. This is carried out in the form of instructions, that is, written orders that oblige the insurer to eliminate violations within the specified period.
The grounds for imposing restrictions are:
- activities in areas not covered by the license;
- implementation of activities prohibited by law;
- violation of the order of formation of reserves;
- unjustified tariff reduction;
- non-compliance with the established ratio of assets and liabilities;
- reporting, other requested documents with a violation of time or order;
- inconsistency of the information provided to actual data;
- violation of the terms for notification of changes in the charter, rules for the provision of services, the structure of rates;
- transfer of a license to another organization;
- issuance of a policy without the application of rules;
- the conclusion of contracts on more extended terms, rather than those that are prescribed in the rules.
If the prescription is not followed, the supervisory authoritymay limit the validity of the license. This can be expressed both in the ban on the conclusion of new contracts, and in the extension of the old for certain activities or in the specified territory.