Bancassurance Distribution Agreement Sample
In accordance with Circular 37, bancassurance agreements between banks and insurers must contain the same information as required in the insurance contracts typical of the insurance agency, as provided for by the Insurance Act (which includes the name, address and obligations of banks and insurers, the content and scope of the bancassurance agreement , the mechanisms for commissioning, expiry and dispute resolution). This clear delineation of the property strengthens the good management and management of bancassurance activities. In France, the supervisory authorities of banks and insurance merged in January 2010. Today, the protection of depositors and policyholders and the financial stability of the system are under one roof. This makes it easier to control bancassurance activities. Note that this merger was not a necessary element for the development of this distribution channel, as Bancassurance was well established and flourishing before the merger of the regulators. Common circular 86 is committed only to bancassurance agreements between banks and life insurers. Circular 37 expands this flexibility to include general (non-life) insurance and reinsurance companies. What about France? Banks have shown that they can be basic insurers. Insurers try to be non-demanding banks. Mutual insurers cooperate with trade associations.
The Internet breaks face to face models based on relationships that offer cheaper convenience products. It seems that the distribution of financial products in France will continue to grow. It is advantageous for insurers to take advantage of the bank`s positive image, its presence and location in the country and the strength of its network. The bank provides a very large base of potential customers and allows insurers to diversify their distribution channels. With regard to bancassurance agreements, Vietnamese law treats banks as agents of the insurer and bancassurance distribution agreements as insurance agreements. More than a partnership with distribution agreements between the two parties, Bancassurance has developed in France in an integrated model. Banks have created special insurance subsidiaries, i.e. separate legal entities with insurance licences whose capital is all or partly owned by the bank. The bank is involved in the management, management, profitability and sustainability of the insurance business. The French government has facilitated access to credit and insurance through insurance legislation. In concrete terms, the French government passed a law that initially allowed access to mortgage insurance only for people infected with HIV and in the event of death (Belorgey Agreement – 1991).
Subsequently, they extended it to serious preconditions (AERAS agreement – January 2007). AERAS is synonymous with Insuring and borrowing an Aggravated Health Risk, translated into English, in order to secure and borrow with an increased risk to health. AERAS has allowed people at particularly high risk of disability to receive insurance. In addition, exclusions and premium increases will be limited. Previously, bancassurance distribution agreements between banks and life insurers were governed by common circular 86. Following the issuance of the new rules on insurers` insurance activities under Circular 50 and Decree 73, Circular 37 was issued to replace Common Circular 86 and to clarify banks` rights and obligations with respect to bancassurance agreements. Insurers and banks can audit existing and new bancassurance agreements to assess the impact and compliance issues of Circular 37. The Vietnamese National Bank (SBV) recently issued Circular 37, which contains guidelines for bancassurance operations, in particular insurance agencies of foreign credit institutions and bank branches (“banks”) for insurance companies (“insurers”). Circular 37 will come into force on 2 March 2020 without clarifying the transitional mechanisms or the effects on the bancassurance agreements implemented ahead of