August 12, 2022

Amendments to the law on the Insurance Market and the securities market have been signed

The President signed the law “On Amendments and additions to some legislative acts of the Republic of Kazakhstan on regulation and development of the insurance market and securities market, banking activities,” the press service of Akorda reports.

The law is designed to further develop the financial market through the introduction of new, socially important life insurance products and digitalization of services.

In the field of insurance, new institutions of accumulative life insurance have appeared, expanded the list of guaranteed types of insurance for social and mass types of insurance, increased the status and development of the insurance ombudsman, and also provided citizens with the possibility of partial repayment of money under pension annuity contracts back to the UAPF;

Earlier, Deputy Denmark Espayeva commented on the introduction of online settlement of insurance claims together with the introduction of the Eroprotokol and the improvement of the pricing system for compulsory car insurance, which simplifies the registration of insurance payments:

“It is supposed to introduce a simplified procedure for the settlement of an insured event for motor insurance (Euro Protocol), implemented using a mobile application without the participation of the police and going to court to ensure prompt receipt of insurance payments for road accidents (accidents). This includes improving the pricing system of compulsory car insurance by revising the “bonus-malus” coefficients used to provide discounts when buying an insurance policy for drivers with a low accident rate.”

It was also reported that the securities market excludes a ban for brokerage organizations and investment portfolio managers on accounting and storing client assets in affiliated custodians, with the exception of storing assets of collective forms of investment (pension assets, assets of mutual funds).

To enhance the role of the stock market as a channel for attracting financing by the private sector, it is envisaged to create legal conditions for hedging the risks of Kazakhstani companies within the framework of the general agreements of the International Swaps and Derivatives Association (ISDA).

In banking, the activities of banks, bank holdings and subsidiaries of banks have expanded. Microfinance organizations will be able to transform into second-tier banks through the conversion mechanism without interrupting microfinance activities until obtaining a banking license.

The law will increase the attractiveness of the financial market for consumers, ensure its dynamic growth and competitive development to effectively meet the needs of the economy.

The law will provide opportunities to expand the activities of insurance and reinsurance companies participating in the AIFC, as well as opportunities to open correspondent accounts for AIFC member banks in second-tier banks in Kazakhstan.