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Chapter Five
The Establishments of Insurance and Reinsurance
A ) Insurance and Reinsurance Companies
Article 17 - Under the provisions of this Act the term insurance and reinsurance companies means the joint stock companies authorized to transact insurance and reinsurance business whatever its instrument of establishment and shall be referred to in this Act as the "company".
Article 18 - With the exception of the provisions of this Act, the provisions of Act No.60 of 1971 for the public sector organizations and affiliated companies shall apply to the insurance and reinsurance companies which are deemed public companies according to its provisions.
However, insurance and reinsurance companies not considered public companies are subject, with the exception of what is specified in this Act, to Act No.26 of 1954, on the joint stock and limited companies with the exception of articles 24 (2) 30, 33, 33 (b). Moreover, there shall be no circulation of the portions of incorporation and the shares within the first two years of the company without the consent of the board of directors of the Authority.
Article 19 - Each company shall have a board of directors formed according to the Act applied to it and the chairman is to represent the company in Courts and in its relation with other parties.
Article 20 - The board of directors of a company controls and runs its affairs. It shall set up the company's insurance and investment plan and supervise its implementation. It is entitled to issue the decisions it sees fit to guarantee the achievement of the company's objectives within the framework of this Act. The board has in particular the power to:
1 - Carry on insurance and reinsurance business in accordance with the decision of the
company's establishment and authorization issued by the Authority.
2 - Contribute to the development of savings and financial investment.
3 - Participate in the establishment of enterprises and companies in the different spheres of
economic activity within the framework of the state's national plan.
4 - Approve the draft of the general plan, the annual accounts and the balance sheet in
preparation for submitting them to the general meeting for sanction
5 - Approve the organizational structure.
6 - Issue the financial technical and administrative systems and regulations including those
related to the company's staff, their salaries, wages, remunerations, benefits, special
allowances, at home and abroad per diems and incentive systems.
The board of directors of public companies shall not be bound in issuing its directives in accordance with item (5 & 6) to the rules and regulations specified in Act No.60 of 1971 of public sector organizations and affiliated companies and Act. No 48 of 1978 of the system of public sector personnel provided that the principles shown below shall be applied:
First : Linking the wages with performance.
Second : The rules of the social insurance system according to Act No.79 of 1975.
Third : No contravention to the staff unions participation as stipulated in the Acts.
Article 20 (bis) - The general meeting of each insurance and reinsurance company subordinate to the public sector is formed under the chairmanship of the competent minister or his representative and with the membership of each of :
a) The chairman of the board of directors of the Insurance Supervisory Authority.
b) A representative of each of the Ministry of Finance, Ministry of Planning and Ministry of
Economic and Foreign Trade.
c) The chairmen of the other public insurance and reinsurance companies.
d) Four employees of the company, other than the board members, chosen by its trade union
e) Members who have experience in the company's business not exceeding four nominated by
the competent minister.
The chairman of the company, the board members and the auditors from the Central Organization of Accounting attend the general meeting without having voting counted.
The resolutions of the general meeting are passed by a majority of the members present and voting except cases which require obtaining a special majority under the provisions of the Act and the memorandum of association of a company.
Article 21 - The net profits of the public companies shall be transferred to the treasury after deducting the estimated reserves, provisions and the staff share of the profits.
The general state budget shall not include the resources and current and capital expenditures of these companies.
B) Co-aperative Insurance Societies.
Article 22 - A co-operative insurance society is one which is formed within the framework of the general rules of co-operation and provide that the value of shares or its capital portions at the establishment and the paid up capital are not less than the amount specified in the executive regulation of this Act
The Authority shall register and authorize these organizations to carry on their activities under its supervision and control.
The mutual organization acquires the legal entity when it is registered in the prescribed register at the Authority.
The executive regulation shall define the necessary rules and conditions for the establishment, registration and the technical bases of these societies.
C) Private Insurance Funds
Article 23 - under the provisions of this Act, a private insurance fund means every system in a body corporate, trade union or a society composed of members of one profession or the same work or having any other social relation. This system is formed without a capital, financed by subscriptions or other means with the view of granting its members, or beneficiaries, certain insurance rights in the form of compensations or periodical pensions or specified financial benefits.
These Funds are subject to the provisions of the Private Insurance Funds Act No.54 of 1975
D) Governmental Insurance Funds
Article 24 - This term means the Funds that transact the insurance of risks not normally acceptable by insurance companies or those which the government decides to undertake by itself.
The governmental Insurance Fund shall be set up by the Prime Minister's decree. Rates and conditions of the Insurance transactions mentioned above shall be fixed by the competent minister's decree through the proposal of the board of the Authority.
The executive regulation of this Act includes the provisions regulating the Authority's supervision and control aspects of these Funds.
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