Corporate governance structure of an insurance company and reinsurance company in Vietnam

Corporate governance structure of an insurance company and reinsurance company in Vietnam (Internet image)

1. Corporate organization structure of an insurance company, reinsurance company or foreign branch in Vietnam

Article 78 of the Law on Insurance Business 2022 stipulates the regulations on corporate organization structure of an insurance company, reinsurance company or foreign branch in Vietnam:

- The domestic operating organizations of the insurer, reinsurance enterprises include the head office, branches, representative offices, business locations.

- The overseas operating organizations of the insurer, reinsurance enterprises include branches, representative offices, or other forms of commercial presence as prescribed by law.

- The operating organizations of foreign branches in Vietnam include the head office and business locations.

2. Corporate governance structure of an insurance company and reinsurance company in Vietnam

According to Article 79 of the Law on Insurance Business 2022 on corporate governance structure of an insurance company and reinsurance company in Vietnam:

- Insurance enterprises and reinsurance enterprises established in the form of a joint-stock company have the right to choose their management structure according to one of the following two models:

+ General Meeting of Shareholders, Board of Directors, Supervisory Board, Director, or General Director. The Supervisory Board consists of 3 to 5 members as prescribed by the company's Charter;

+ General Meeting of Shareholders, Board of Directors, Director, or General Director, with at least 20% of the Board of Directors members being independent members and having an Audit Committee under the Board of Directors. The structure, functions, and tasks of the Audit Committee are prescribed by the company's Charter or the operation regulations of the Audit Committee issued by the Board of Directors.

- Insurance enterprises and reinsurance enterprises established in the form of a limited liability company have a management structure including the Members' Council, Director, or General Director. Insurance enterprises and reinsurance enterprises can decide to establish a Supervisory Board to ensure compliance with the law.

3. Regulations for managers and controllers of insurance companies, reinsurance companies and foreign branches in Vietnam

According to Article 80 of the Law on Insurance Business 2022, regulations for managers and controllers of insurance companies, reinsurance companies and foreign branches in Vietnam are stipulated as follows:

- Managers of an insurer, reinsurance enterprises include the following positions:

+ Chairman of the Board of Directors, member of the Board of Directors, or Chairman of the Members' Council, member of the Members' Council;

+ Director or General Director, Deputy Director or Deputy General Director, legal representative;

+ Chief Accountant, Branch Director, Head of Representative Office, heads of professional departments, and equivalent positions as prescribed by the company's Charter.

- Managers of foreign branches in Vietnam include the following positions:

+ Director, Deputy Director;

+ Chief Accountant, heads of professional departments, and equivalent positions as prescribed by the organizational and operational regulations of the foreign branch in Vietnam.

- Controllers at the insurer, reinsurance enterprises, and foreign branches in Vietnam have independent professional expertise, including the following positions:

+ Head of the Supervisory Board, Controllers;

+ Head of the Risk Management Department, Head of Compliance Control Department, Head of Internal Audit Department;

+ Actuary.

- Insurance enterprises, reinsurance enterprises, and foreign branches in Vietnam must ensure to maintain a Director and an Actuary or a General Director and an Actuary. In case of a change, within 75 days from the date the Director, General Director, or Actuary ceases to hold their position, the insurer, reinsurance enterprises, or foreign branches in Vietnam must submit a valid dossier to the Ministry of Finance for approval of the new Director or General Director, and Actuary.

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