What are the contents of insurance agent contracts? What are the regulations on bonuses and support for insurance agents and other benefits as agreed in the insurance agent contracts in Vietnam?
What are the contents of insurance agent contracts in Vietnam?
Pursuant to the provisions of Article 126 of the Law on Insurance Business 2022, the contents of insurance agent contracts includes:
- Name and address of the insurance agent;
- Name and address of the head office of the insurance company, branch of the non-life insurance company or mutual providing microinsurance products;
- Rights and obligations of the insurance company, branch of the non-life insurance company, mutual providing microinsurance products, insurance agent;
- Scope of business of the insurance agent;
- Insurance agent commissions, rewards, support provided for the insurance agent and other interests (if any);
- Contract term;
- Dispute settlement methods.
What are the contents of insurance agent contracts? What are the regulations on bonuses and support for insurance agents and other benefits as agreed in the insurance agent contracts in Vietnam?
What are the regulations on bonuses and support for insurance agents and other benefits as agreed in the insurance agent contracts in Vietnam?
Pursuant to Article 52 of Circular 67/2023/TT-BTC, there are regulations on Bonuses and support for insurance agents and other benefits as agreed in the insurance agent contract as follows:
(1) Bonuses and support for insurance agents and other benefits as agreed in the agency contracts of non-life insurers and branches of foreign non-life insurers are provided as follows:
Insurance agent contract | Bonuses and support and other benefits |
As for health insurance | Total bonuses, support, and other benefits of insurance agents do not exceed 100% of the insurance agent commission of all health insurance policies marketed in the fiscal year; |
As for non-life insurance: | Total bonuses, support, and other benefits of insurance agents do not exceed 50% of the insurance agent commission of all non-life insurance policies marketed in the fiscal year. |
(2) Bonuses and support for insurance agents and other benefits as agreed in the agent contracts of life insurers and health insurers are provided as follows:
Agents | Bonuses and support and other benefits |
For agents who market new insurance policies | Total bonuses, support, and other benefits of insurance agents in each fiscal year do not exceed 20% of the actual insurance premium collected from insurance policies with a term of 1 year or less and renewable annually, and 30% of the actual first-year insurance premium collected from insurance policies with a term of more than 1 year. |
For agents who service renewed insurance policies with a term of more than 1 year | Total bonuses, support, and other benefits of insurance agents in each fiscal year do not exceed 7% of the actual renewed insurance premium collected in the fiscal year. |
Notes:
- Life insurers that currently pay agent commissions, support, and other benefits to agents at a rate higher than the rate prescribed in Clause 2 of this Article shall be responsible for reviewing, building a roadmap, and implementing a plan to reduce the rate of payment of the above-mentioned amounts in each fiscal year and completing the implementation of the plan by no later than December 31, 2025.
- The Board of Directors (Board of Members) of the life insurer shall be responsible for approving the plan prescribed in Clause 3 of this Article before December 31, 2023, and for monitoring and supervising the roadmap and plan.
What are the operating principles of insurance agents in Vietnam?
Pursuant to the provisions of Article 127 of the Law on Insurance Business 2022:
Operating principles of insurance agents
1. Persons cannot be insurance agents for other insurance companies or branches of foreign non-life insurance companies operating in the business lines or sectors that are the same as those in which the principal insurance companies or branches of foreign non-life insurance companies for which these persons are acting as agents are performing transactions. A person acting as an insurance agent for a mutual providing microinsurance products shall not be allowed to act as the insurance agent for the other mutual providing microinsurance products.
2. An entity cannot be an insurance agent for the other insurance company or branch of a foreign non-life insurance company or mutual providing microinsurance products without the written approval from the insurance company, branch of the foreign non-life insurance company or mutual providing microinsurance products for which that entity is acting as the agent.
3. Persons rendering insurance agent services or employees of entities doing insurance agent business can only render insurance agent services for insurance schemes or products in which they are trained.
4. Biodata about persons rendering insurance agent services and staff members of entities rendering insurance agent services that are directly involved in insurance agent services must be registered and updated in the database of insurance agent services according to Article 11 herein.
5. Persons that have obtained certificates of practising in the insurance agent business sector, but have not operated in the insurance agent business sector, during 03 consecutive years must take tests to obtain new ones before commencement of the insurance agent services.
Thus, the activities of insurance agents must comply with the above principles.
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