WHAT IS AN INSURANCE BUSINESS? INSURANCE ENTERPRISES MUST ESTABLISH A UNIT-LINKED FUND INVESTMENT COUNCIL TO CONDUCT WHAT ACTIVITIES?

Currently, issues related to insurance are of concern to Vietnamese society and people. So what is an insurance business? Insurance enterprises must establish a unit-linked fund investment council to conduct what activities? Through today’s article, let’s learn more about this issue with Pham Consult!

What is an insurance business?

According to the provisions of Clause 17, Article 3 of the Law on Insurance Business 2020: “Insurance enterprise is an enterprise established, organized and operating according to the provisions of this Law and other relevant laws to conduct insurance business.” insurance, reinsurance business, reinsurance transfer. Insurance businesses include life insurance businesses, non-life insurance businesses, and health insurance businesses.”

Thus, insurance businesses include life insurance businesses, non-life insurance businesses, and health insurance businesses.

Insurance enterprises must establish a unit-linked fund investment council to conduct what activities?

In case an insurance enterprise must establish an Investment Council, it is prescribed in Clause 1, Article 112 of Decree 46/2023/ND-CP as follows:

Unit-linked fund investment council

1. Insurance enterprises must establish an Investment Council to conduct the following activities:
2. a) Approve the investment policies and procedures of each unit-linked fund on the most prudent basis to ensure the safety of the unit-linked fund’s assets and in accordance with the investment objectives and strategies of the unit. Each unit-linked fund has been announced to customers. Approve the valuation manual and agree to use the valuation manual when using more than 01 unit-linked fund management companies. Any changes in the regulations, policies and investment procedures of each unit-linked fund must be approved by the Investment Council before application;
3. b) Decide to close the unit-linked fund to convert assets to a new unit-linked fund with the same investment objectives; change the name of the unit-linked fund; split or merge existing unit-linked fund units or stop valuing unit-linked fund units and transactions related to insurance contracts in special cases specified in the insurance contract to ensure the interests of insurance buyers;
4. c) Approve the selection of investment assets in accordance with the investment limits specified in Article 108 of this Decree;
5. d) Other tasks as required by competent state agencies and provisions of law.

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Thus, according to regulations, insurance enterprises must establish a unit-linked fund investment council to conduct the following activities:

(1) Approve the investment policies and procedures of each unit-linked fund on the most prudent basis to ensure the safety of the unit-linked fund’s assets and in accordance with investment goals and strategies of each unit-linked fund announced to customers.

Approve the valuation manual and agree to use the valuation manual when using more than 01 unit-linked fund management companies.

Any changes in the regulations, policies and investment procedures of each unit-linked fund must be approved by the Investment Council before application;

(2) Decide on:

– Close the unit-linked fund to convert assets to a new unit-linked fund with the same investment objectives;

– Change the name of the unit-linked fund;

– Splitting or merging existing unit-linked fund units or stopping valuation of unit-linked fund units;

– Transactions related to insurance contracts in special cases are specified in the insurance contract to ensure the interests of the insurance buyer;

(3) Approve the selection of investment assets in accordance with the investment limits specified in Article 108 of Decree 46/2023/ND-CP;

(4) Other tasks as required by competent state agencies and provisions of law.

 

How many members must the insurance enterprise’s unit-linked fund investment council have?

The unit-linked fund investment council of an insurance enterprise is prescribed in Clause 2, Article 112 of Decree 46/2023/ND-CP as follows:

Unit-linked fund investment council

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2. The Investment Council has at least 03 members, including:
3. a) 01 member is an actuary of an insurance enterprise;
4. b) 01 member is an employee of an insurance enterprise or parent company of an insurance enterprise or a fund management company with a certificate of financial investment analysis (CFA) or fund management practice certificate issued by Issued by the State Securities Commission or equivalent specialized degrees and have at least 03 years of experience managing operations of open funds or unit-linked funds;
5. c) 01 member is a lawyer of an insurance enterprise or the parent company of an insurance enterprise; Have legal expertise in the field of investment or have at least 5 years of experience directly working in the fields of insurance, finance or banking.

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Thus, according to regulations, the Unit-Linked Fund Investment Council of an insurance enterprise must have at least 03 members, including:

(1) 01 member is an actuarial expert of an insurance enterprise;

(2) 01 member is an employee of an insurance enterprise or parent company of an insurance enterprise or fund management company;

(3) 01 member is a lawyer of an insurance enterprise or the parent company of an insurance enterprise.

 

In what form is the decision of the Unit-Linked Fund Investment Council approved?

The decision of the Unit-Linked Fund Investment Council is stipulated in Clause 3, Article 112 of Decree 46/2023/ND-CP as follows:

Unit-linked fund investment council

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1. c) 01 member is a lawyer of an insurance enterprise or the parent company of an insurance enterprise; Have legal expertise in the field of investment or have at least 5 years of experience directly working in the fields of insurance, finance or banking.
2. The Investment Council must meet quarterly and may meet irregularly at the request of the insurance enterprise. Decisions of the Investment Council are passed through voting at face-to-face meetings, meetings via telephone, internet and audio and visual media, or in the form of written opinions.

Thus, the decisions of the Unit-Linked Fund Investment Council are passed by voting at face-to-face meetings, meetings via telephone, internet and other audio and visual media, or in the form of soliciting opinions. written opinion.

 

Above is information about insurance businesses and issues surrounding insurance business operations. Hope the above information will help your work.