Article 34. Requirements for senior employees of an insurance (reinsurance) organization, insurance holding company and insurance broker of the Insurance Law

Home / RLA / Article 34. Requirements for senior employees of an insurance (reinsurance) organization, insurance holding company and insurance broker of the Insurance Law

 1. The head and members of the management body, the head and members of the executive body, the chief accountant and other heads of the insurance (reinsurance) organization who coordinate and (or) control the activities of two or more structural divisions of the insurance (reinsurance) organization and have the right to sign documents on the basis of which the insurance (reinsurance) organization is conducted are recognized as senior employees of the insurance (reinsurance) organization. insurance and/or investment activities, with the exception of the heads of branches and representative offices of an insurance (reinsurance) organization and their chief accountants.

At least one of the members of the executive body of an insurance (reinsurance) organization must have supporting documents confirming that they have attended at least fifty percent of the courses of the minimum mandatory actuarial training program established by a regulatory legal act of the authorized body.

The head and his deputies, the chief accountant, are recognized as senior employees of an insurance broker.

1-1. The head and his deputies, other heads of the branch of the insurance (reinsurance) organization-non-resident of the Republic of Kazakhstan, who coordinate and (or) control the activities of two or more structural divisions of the branch of the insurance (reinsurance) organization-non-resident of the Republic of Kazakhstan and have the right to signatures of the documents on the basis of which the insurance activity is carried out, the chief accountant. At least two senior employees of a branch of a non-resident insurance (reinsurance) organization of the Republic of Kazakhstan must be residents of the Republic of Kazakhstan.

The head and his deputies, the chief accountant, are recognized as senior employees of a branch of a non-resident insurance broker of the Republic of Kazakhstan.

The head of a branch of a non–resident insurance (reinsurance) organization of the Republic of Kazakhstan and his deputies, the head of a branch of a non–resident insurance broker of the Republic of Kazakhstan and his deputies may not hold the position of head of the executive body or a person solely performing the functions of the executive body, a legal entity, a senior employee in other financial organizations and branches of insurance (reinsurance) organizations of non–residents Of the Republic of Kazakhstan, branches of insurance brokers – non-residents of the Republic of Kazakhstan, branches of banks – non-residents of the Republic of Kazakhstan.

1-2. For the purposes of this article, a candidate for the position of a senior employee is an individual who intends to hold the position of a senior employee of an insurance (reinsurance) organization, a branch of an insurance (reinsurance) organization that is a non–resident of the Republic of Kazakhstan, an insurance broker, a branch of an insurance broker that is a non–resident of the Republic of Kazakhstan, or a person elected to the position of head or member of a management body, who is an independent director.

2. An insurance (reinsurance) organization or insurance broker must, within one hundred and twenty calendar days after the end of the financial year, submit to the National Bank reports including information on income paid by the insurance (reinsurance) organization or insurance broker to all senior employees of the insurance (reinsurance) organization or insurance broker during the financial year, in the form provided by established by the regulatory legal act of the National Bank in coordination with the authorized body.

The requirements for the internal policy of an insurance (reinsurance) organization, insurance broker on remuneration, accrual of monetary rewards, as well as other types of financial incentives for senior employees of an insurance (reinsurance) organization, insurance broker are determined by a regulatory legal act of the authorized body.

3. A person cannot hold (cannot be appointed or elected to) the position of a senior employee of an insurance (reinsurance) organization or insurance broker.:

1) has no higher education;

2) who does not have the length of service established by this article:

in international financial organizations, the list of which is established by the authorized body;

and (or) in the field of regulation, control and supervision of the financial market and financial organizations;

and (or) in the field of financial services;

and (or) conducting an audit of financial institutions;

and (or) in the field of regulation of audit services for financial institutions;

and (or) in the field of software development used to automate the activities of financial organizations;

and (or) in foreign legal entities operating in the areas listed in this subparagraph;

and (or) in the national management holding company or the Development Bank of Kazakhstan, or the special fund for the development of private entrepreneurship, or the Export Credit Agency of Kazakhstan in the positions provided for in subparagraph 3) paragraph 5-1 of this Article and (or) in the national management holding company or the Development Bank of Kazakhstan, or the special fund for the development of private entrepreneurship, or the Export Credit Agency of Kazakhstan in the positions provided for in subparagraph 3) paragraph 5-1 of this article; ;

3) does not have an impeccable business reputation;

4) who has had his consent to be appointed (elected) to the position of a senior employee revoked and (or) who has been removed from his official duties in this and (or) in another financial organization, banking, insurance holding, this and (or) another branch of a non–resident bank of the Republic of Kazakhstan, a branch of an insurance (reinsurance) a non–resident organization of the Republic of Kazakhstan, a branch of a non–resident insurance broker of the Republic of Kazakhstan.

This requirement is applied during the last twelve consecutive months after the decision of the authorized body to revoke consent to the appointment (election) to the position of a senior employee.;

5) who has committed a corruption offense or has been subjected to administrative punishment for committing a corruption offense within three years prior to the date of filing an application for approval for a senior position.

When appointing (electing) senior management personnel, an insurance (reinsurance) organization or insurance broker independently checks them for compliance with the requirements of this article, including taking into account information posted on the authorized body's Internet resource.

The assessment of business reputation for the presence or absence of an impeccable business reputation in relation to senior employees and candidates for senior positions is carried out by the authorized body, including using motivated judgment.

3-1. A person who is a person with special relations with an insurance (reinsurance) organization and (or) has been a member of the board of directors for three years prior to the date of filing an application for approval for the position of a member of the board of directors – an independent director of an insurance (reinsurance) organization may not be a member of the board of directors.) organizations.

4. A major participant in an insurance (reinsurance) organization may not be appointed (elected) to the position of head of the executive body of an insurance (reinsurance) organization.

The number of members of the executive body must be at least three persons.

5. To comply with the requirement provided for in subparagraph 2) in the first part of paragraph 3 of this article, it is necessary to have a work record for candidates for positions:

1) the head or a member of the management body who is a member of the executive body of the parent financial organization, the head of the executive body, the head of a branch of a non–resident insurance (reinsurance) organization of the Republic of Kazakhstan for at least five years, including at least three years in a senior position;

2) the head of the management body of an insurance (reinsurance) organization for at least five years, including at least two years in a senior position;

3) a member of the executive body of an insurance (reinsurance) organization, deputy head of a branch of a non–resident insurance (reinsurance) organization of the Republic of Kazakhstan, head of an insurance broker, his deputy, head of a branch of a non–resident insurance broker of the Republic of Kazakhstan, his deputy for at least three years, including at least two years in a senior position;

4) a member of the management body of an insurance (reinsurance) organization for at least two years, including at least one year in a senior position;

5) the chief accountant of an insurance (reinsurance) organization, a branch of a non–resident insurance (reinsurance) organization of the Republic of Kazakhstan, an insurance broker, a branch of a non–resident insurance broker of the Republic of Kazakhstan for at least three years;

6) other heads of an insurance (reinsurance) organization, a branch of a non–resident insurance (reinsurance) organization of the Republic of Kazakhstan for at least one year.

For candidates for the positions of members of the executive body of an insurance (reinsurance) organization responsible exclusively for security issues, administrative and economic issues, information technology issues, and the length of service provided for in subparagraph 2) paragraph 3 of this article is not required.

The length of service defined in this paragraph does not include work in the departments of a financial institution related to ensuring its security, carrying out administrative and economic activities, developing information technology (with the exception of the head of the information technology and (or) information security development department), working in a mutual insurance company.

For a member of the Government of the Republic of Kazakhstan, deputy head of the central executive body of the Republic of Kazakhstan, who is a candidate for the position of head of the management body of an insurance (reinsurance) organization, more than fifty percent of the outstanding shares of which are directly or indirectly owned by the state and (or) the national management holding, the length of service provided for in this article is not required.

5-1. For the purposes of subitems 1), 2), 3) and 4) of the first part of paragraph 5 of this Article, a managerial position is a position:

1) a senior employee, a head who coordinates and (or) controls the activities of two or more structural divisions, the head, deputy head of a structural division, as well as a separate division of a financial organization, a branch of a non–resident insurance (reinsurance) organization of the Republic of Kazakhstan, a branch of a non–resident insurance broker of the Republic of Kazakhstan, a branch of a non–resident bank of the Republic of Kazakhstan;

2) the first head and his deputy, the head, the deputy head of the structural unit of the state body in the field of regulation of financial services and (or) regulation and state control in the field of auditing of financial organizations;

3) the head of the management body, the head of the executive body, as well as his deputy in charge of financial matters and (or) the activities of subsidiary financial organizations, the national management holding company, the Development Bank of Kazakhstan, the special fund for the development of private entrepreneurship and the Export Credit Agency of Kazakhstan;

4) the first head and his deputy, the head or deputy head of a structural subdivision, as well as a separate subdivision in:

international financial organizations specified in the second paragraph of subparagraph 2) of the first part of paragraph 3 of this Article;

organizations conducting audits of financial institutions;

organizations engaged in activities in the field specified in the seventh paragraph of subparagraph 2) of the first paragraph of paragraph 3 of this Article;

foreign legal entities specified in the eighth paragraph of subparagraph 2) of the first part of paragraph 3 of this Article.

5-2. Documents for obtaining consent to the appointment (election) of a senior employee of an insurance (reinsurance) organization, an insurance broker, may be provided by a candidate for the position of a senior employee or an insurance (reinsurance) organization, an insurance broker.

The consent of the authorized body for the appointment (election) of a senior employee of an insurance (reinsurance) organization or insurance broker may be issued for one or more positions, provided that the candidate for the position of a senior employee meets the requirements for these positions.

The consent of the authorized body to the appointment (election) of a senior employee of an insurance (reinsurance) organization, an insurance broker, gives the right to hold the position of a senior employee without re-approval and terminates in the following cases:

1) non–appointment (non–election) of an agreed candidate for the position of a senior employee in an insurance (reinsurance) organization, a branch of an insurance (reinsurance) organization that is a non-resident of the Republic of Kazakhstan, an insurance broker, a branch of an insurance broker that is a non-resident of the Republic of Kazakhstan within twelve months from the date of consent or dismissal (termination of powers) of a senior employee;

2) withdrawal by the authorized body of consent to the appointment (election) to the position of a senior employee of an insurance (reinsurance) organization, a branch of an insurance (reinsurance) organization that is a non–resident of the Republic of Kazakhstan, an insurance broker, a branch of an insurance broker that is a non–resident of the Republic of Kazakhstan.

6. A candidate for the position of a senior employee may not perform the relevant functions without the approval of the authorized body.

The prohibition established by the first part of this paragraph does not apply to a person elected to the position of head or member of the management body, who is an independent director, who has the right to perform the relevant functions without the consent of the authorized body for no more than sixty calendar days from the date of his election.

The authorized body reviews the documents submitted for the approval of the appointment (election) of senior officials of an insurance (reinsurance) organization, insurance broker, within thirty working days from the date of submission of the full package of documents in accordance with the requirements of the regulatory legal act of the authorized body.

It is prohibited to perform duties (to replace a temporarily absent) senior employee of an insurance (reinsurance) organization, insurance broker, branch of a non–resident insurance (reinsurance) organization of the Republic of Kazakhstan, branch of an insurance broker – a non–resident of the Republic of Kazakhstan by a person who does not have the consent of the authorized body to appoint (elect) a senior employee, except in cases where the duties of the head of the executive body are assigned to a member of the executive body of an insurance (reinsurance) organization, the head to the deputy head of an insurance broker, a branch of an insurance (reinsurance) organization - a non-resident of the Republic of Kazakhstan, a branch of an insurance broker – a non-resident of the Republic of Kazakhstan, the chief accountant for a deputy chief accountant for a period of no more than sixty calendar days.

It is not allowed to assign duties (to replace a temporarily absent) head of the executive body of an insurance (reinsurance) organization, head of an insurance broker, branch of a non–resident insurance (reinsurance) organization of the Republic of Kazakhstan, branch of a non–resident insurance broker of the Republic of Kazakhstan, or chief accountant of an insurance (reinsurance) organization, insurance broker, branch of an insurance (reinsurance) organization – a non-resident of the Republic of Kazakhstan, a branch of an insurance broker – a non-resident of the Republic of Kazakhstan for the persons specified in part four of this paragraph, due to the absence of a candidate agreed with the authorized body, for a total of more than one hundred and eighty calendar days within twelve consecutive months.

6-1. A candidate for the position of head or member of the management body, who is an independent director, may be approved both before and after his election to the specified position.

When approving the head or a member of the management body who is an independent director, after his election, the documents for approval must be submitted to the authorized body within the time period established by the second part of paragraph 6 of this article.

Upon expiration of the period specified in this paragraph, and in case of failure to submit a complete package of documents for approval to the authorized body or refusal by the authorized body to approve, the insurance (reinsurance) organization, a branch of a non–resident insurance (reinsurance) organization of the Republic of Kazakhstan, an insurance broker, a branch of a non–resident insurance broker of the Republic of Kazakhstan are obliged to take measures to terminate the authority of this executive officer.

6-2. When the authorized body uses a reasoned judgment regarding a candidate for the position of a senior employee in accordance with Article 13-5 of the Law of the Republic of Kazakhstan "On State Regulation, Control and Supervision of the Financial Market and Financial Organizations", the authorized body sends a notification to the person who submitted the documents for approval of a candidate for the position of a senior employee. motivated judgment.

The authorized body suspends the period of consideration of documents submitted to obtain consent for the appointment (election) of candidates for senior positions of an insurance (reinsurance) organization, a branch of an insurance (reinsurance) organization that is a non–resident of the Republic of Kazakhstan, an insurance broker, a branch of an insurance broker that is a non–resident of the Republic of Kazakhstan, when the authorized body forms a reasoned judgment regarding these candidates for positions of senior employees. This period is suspended from the date of sending the draft reasoned judgment to the person who submitted the documents for approval of the candidate for the position of a senior employee, until the date of the decision of the authorized body using the reasoned judgment.

7. The procedure for issuing the consent of the authorized body for the appointment (election) of a senior employee of an insurance (reinsurance) organization, insurance holding company and insurance broker, including criteria for the absence of an impeccable business reputation, and documents necessary to obtain consent, are established by regulatory legal acts of the authorized body.

A fee is charged for granting consent to the appointment (election) of a senior employee of an insurance (reinsurance) organization, insurance holding company and insurance broker, the amount and payment procedure of which are determined by the tax legislation of the Republic of Kazakhstan.

8. The authorized body refuses to grant consent to the appointment (election) of senior officials of an insurance (reinsurance) organization and an insurance broker on the following grounds:

1) non-compliance of candidates for senior management positions with the requirements established by this Article, Article 16-2 of this Law, subparagraph 20) of Article 1, paragraph 4 of Article 54 and paragraph 2 of Article 59 of the Law of the Republic of Kazakhstan "On Joint Stock Companies", Article 9 of the Law of the Republic of Kazakhstan "On Accounting and Financial Reporting" or a regulatory legal act authorized body;

2) negative test result.

The negative test results are:

The test result of a candidate for the position of a senior employee is less than seventy percent of the correct answers.;

violation by a candidate for the position of a senior employee of the testing procedure determined by the authorized body;

failure to appear for testing at the appointed time during the period of approval of the candidate for the position of a senior employee by the authorized body;

3) failure to eliminate the comments of the authorized body or submission of documents modified taking into account the comments of the authorized body after the expiration of the period established by the regulatory legal act of the authorized body.;

4) violation of the procedure established by the legislation of the Republic of Kazakhstan for the election (appointment) of a candidate for the position of head or member of the management body who is an independent director;

5) submission of documents after the expiration of the period established by the second part of paragraph 6-1 of this article, during which a candidate for the position of head or member of the management body, who is an independent director, holds his position without the consent of the authorized body.;

6) the authorized body has information (facts) about the actions committed by the candidate for the position of a senior employee, recognized as committed for the purpose of manipulating the securities market and (or) causing damage to a third party(s).

This requirement applies for one year from the date of the earliest of the listed events.:

recognition by the authorized body of the actions of a candidate for the position of a senior employee as committed for the purpose of manipulation in the securities market;

receipt by the authorized body of facts confirming the damage caused to a third party (third parties) as a result of such actions;

7) the authorized body has information that the candidate for the position of a senior employee was an employee of a financial institution in respect of which the authorized body applied supervisory response measures and (or) imposed an administrative penalty for an administrative offense provided for in Article 259 of the Code of the Republic of Kazakhstan on Administrative Offenses, for committing acts recognized as committed for the purpose of manipulating the securities market, and (or) by an employee of a financial institution, whose actions caused damage to a financial institution and/or a third party(s) involved in the transaction.

This requirement applies for one year from the date of the earliest of the listed events.:

recognition by the authorized body of the actions of a financial organization as committed for the purpose of manipulation in the securities market;

receipt by the authorized body of facts confirming the damage caused by the actions of a candidate for the position of a senior employee to a financial institution and (or) a third party(s).

For the purposes of this subparagraph, an employee of a financial institution is understood to be a senior employee or a person who performed his duties and/or a stock exchange trader whose competence included making decisions on issues that led to the above violations.

The information specified in subitems 6) and 7) of part one of this paragraph includes information received by the authorized body from the financial supervisory authority of the state in which the non–resident financial institution of the Republic of Kazakhstan is a resident.

9. An insurance (reinsurance) organization or insurance broker must notify the authorized body within five working days from the date of the decision of the relevant body of the insurance (reinsurance) organization or insurance broker of all changes that have occurred in the composition of senior staff, including their appointment (election), transfer to another position, termination of the employment contract and (or) termination of powers, bringing a senior employee to administrative responsibility for committing a corruption offense, as well as changes in last name, first name, the patronymic (if it is indicated in the identity document) of the supervisor, accompanied by copies of supporting documents.

In case of bringing a senior employee to criminal responsibility, an insurance (reinsurance) organization or an insurance broker shall notify the authorized body within five working days from the day when this information became known to the insurance (reinsurance) organization or insurance broker.

10. Excluded by the Law of the Republic of Kazakhstan dated 07/12/2022 No. 138-VII (effective sixty calendar days after the date of its first official publication).

11. The authorized body revokes the consent granted for the appointment (election) to the position of a senior employee of an insurance (reinsurance) organization or insurance broker on the following grounds:

1) identification of false information on the basis of which the consent was given;

2) non-payment, late payment, or payment of mandatory or emergency contributions, as well as initial one-time and additional contributions in incomplete amounts two or more times during the last twelve months to an organization that guarantees insurance payments to policyholders (insured, beneficiaries) in the event of liquidation of insurance organizations;

3) the application by the authorized body of the supervisory response measure specified in subparagraph 11) of paragraph 1 of Article 53-3 of this Law;

4) non-payment, late payment, or incomplete payment of mandatory contributions two or more times during the last twelve months by insurance organizations to the office of the Insurance Ombudsman;

5) the presence of an outstanding or outstanding criminal record;

6) failure by the insurance company to comply with the decision of the Insurance Ombudsman two or more times within the last twelve months within the time limit set by him;

7) non-fulfillment or improper fulfillment by an insurance (reinsurance) organization two or more times during the last twelve months of the requirements for providing information to the database, including its distortion and (or) incomplete and (or) late submission;

8) non-compliance of senior employees with the requirements established by this Article, Article 16-2 of this Law, subparagraph 20) of Article 1, paragraph 4 of Article 54 and paragraph 2 of Article 59 of the Law of the Republic of Kazakhstan "On Joint Stock Companies", Article 9 of the Law of the Republic of Kazakhstan "On Accounting and Financial Reporting" or a regulatory legal act of the authorized body.

Revocation by the authorized body of consent to the appointment (election) of a senior employee in an insurance (reinsurance) organization, insurance holding, insurance broker is the basis for revocation of previously issued consent (consents) to this senior employee in other financial organizations, banking, insurance holdings, branches of insurance (reinsurance) organizations – non-residents of the Republic of Kazakhstan, branches of non–resident insurance brokers of the Republic of Kazakhstan, branches of non–resident banks of the Republic of Kazakhstan.

An insurance (reinsurance) organization or an insurance broker must terminate an employment contract with a senior employee or, in the absence of an employment contract, take measures to terminate the authority of a senior employee in the following cases::

1) withdrawal by the authorized body of consent to the appointment (election) to the position of a senior employee;

2) violations of the procedure established by the legislation of the Republic of Kazakhstan for the election (appointment) of a candidate for the position of a senior employee.

12. Excluded by the Law of the Republic of Kazakhstan dated 07/12/2022 No. 138-VII (effective sixty calendar days after the date of its first official publication). 13. Excluded by the Law of the Republic of Kazakhstan dated 07/12/2022 No. 138-VII (effective sixty calendar days after the date of its first official publication).

14. Senior employees of an insurance holding are recognized as the head and members of the management bodies, the executive body, the chief accountant, and other heads of the insurance holding who coordinate and (or) control the activities of a subsidiary (subsidiary) organization(s) and (or) organization(s) in which the insurance holding has a significant equity interest..

15. The requirements of this article apply to senior employees of insurance holdings, with the exception of:

1) senior employees of insurance holdings that are non-residents of the Republic of Kazakhstan, provided that one of the following conditions is met:

The insurance holding company has an individual credit rating of at least A rating from one of the rating agencies, the list of which is established by the authorized body, as well as written confirmation from the financial supervisory authority of the insurance holding company's country of origin that it is subject to consolidated supervision.;

the existence of an agreement between the authorized body and the relevant supervisory authority of a foreign state on the exchange of information, as well as the minimum required rating of one of the rating agencies. The minimum rating and the list of rating agencies are established by a regulatory legal act of the authorized body.;

2) senior executives who have received the consent of the authorized body to appoint (elect) a senior executive in accordance with the Law of the Republic of Kazakhstan "On Banks and Banking Activities in the Republic of Kazakhstan", insurance holdings that are bank holdings that are part of banking conglomerates.

The Law of the Republic of Kazakhstan dated December 18, 2000 No. 126.

President

Republic of Kazakhstan

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