Operation of insurance agents in credit institutions in Vietnam

Operation of insurance agents in credit institutions in Vietnam (Internet image)

Regarding this issue, LawNet would like to answer as follows:

1. Rules for operation of insurance agents in credit institutions in Vietnam

According to Article 3 of Circular 37/2019/TT-NHNN, the rules for operation of insurance agents in credit institutions include:

- The credit institution must satisfy all conditions and regulations on insurance agents of insurance business laws.

- The credit institution may not use premiums received for any purpose other than those specified in the insurance agent agreement.

- Operation of insurance agents in the credit institution must be included in the License granted by the State Bank of Vietnam.

2. Operation of insurance agents in credit institutions in Vietnam

Specifically, in Article 4 of Circular 37/2019/TT-NHNN, a credit institution with insurance agents may conduct the following activities:

- Client referral: The credit institution may refer a client who would like to purchase insurance to the insurance enterprise.

- Insurance offer:

The credit institution may offer insurance and explain terms and conditions of insurance products to clients who would like to purchase insurance; or offer insurance via electronic or online methods or other methods in compliance with the law.

- Arranging conclusion of insurance policies:

The credit institution may assist its clients with drawing up insurance policies, receive proposal forms and arrange conclusion of insurance policies as per the insurance agent agreement and regulations of laws on insurance business.

- Premium collection:

The credit institution may collect premiums from clients on behalf of the insurance enterprise as agreed upon in the insurance agent agreement.

- Claim settlement upon occurrence:

The credit institution may assist its clients with claim procedures, receive claim forms, transfer premiums received from clients to the insurance enterprise for appraisal, issuance of the compensation decision and claim payment. If authorized by the insurance enterprise, the credit institution may pay out claims directly.

- Other activities to execute the insurance agent agreement in compliance with regulations of laws on insurance business and as authorized by the insurance enterprise.

3. Rights and obligations concerning operation of insurance agents in credit institutions in Vietnam

Rights and obligations concerning operation of insurance agents in credit institutions are specified in Article 6 of Circular 37/2019/TT-NHNN, specifically as follows:

- Credit institutions hold the rights granted to insurance agents per regulations of laws on insurance business.

- Credit institutions shall fulfill the obligations imposed on insurance agents per regulations of laws on insurance business and the following obligations:

+ Explain to clients that insurance products distributed via credit institutions are not products of credit institutions;

+ Manage and retain list of their insurance agents as agreed upon in the insurance agent agreement;

+ Provide adequate and accurate information on premiums received, claim payouts and other payments for insurance enterprises as agreed upon in the insurance agent agreement;

+ Return all premiums received to insurance enterprises exclusive of agent’s commissions, claim payments and other payments as per the insurance agent agreement;

+ Accurately and adequately provide and crosscheck information received from clients with insurance enterprises as prescribed by Article 7 of Circular 37/2019/TT-NHNN.

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