Due to the stabilisation of the situation in the insurance market, the Bank of Russia has decided not to extend a number of easing measures which will expire in 2023. In addition, a set of temporary requirements for insurers’ activity, adopted by the Bank of Russia to support the insurance market, have already become effective on a permanent basis within changes in the requirements for insurers’ financial stability and solvency.1

The above measures include:

— easing of capital buffer requirements for credit risk coverage in order to reduce the probability of default from 50% to 19% for assets with no credit ratings for insurers who do not pay dividends (do not distribute profits);

— extension of the deadline for overdue payments under insurance agreements from five to 30 business days where future due premium payments thereunder can be taken into consideration in the credit risk calculation;

— in relation to bonds issued by a foreign company to the benefit of a Russian entity and purchased before 1 December 2022, the option to use ratings assigned to the ultimate borrower to measure equity capital and risks or, if there are no such ratings, to use ratings of such bonds or their issuers as of 1 February 2022.

Measures planned to be temporarily2 extended until 31 December 2024, including modifications:

— the right of insurers not to disclose information sensitive to sanction risks, including information on the ownership structure, controlling persons, governing authorities, and the composition of members of a mutual insurance company, as provided for by the decision of the Bank of Russia Board of Directors;

— the right of insurers not to disclose information sensitive to sanction risks contained in the notes to and auditor reports on financial statements, the actuarial report and the report about results of the audit of the actuarial report, as provided for by the decision of the Bank of Russia Board of Directors;

— the right not to disclose information on the transfer of the insurance portfolio in cases specified by the decision of the Bank of Russia Board of Directors;

— the option not to disclose information from the register of insurance agents and brokers;

— the option not to apply requirements3 establishing conditions and the procedure for providing insurance of this type to voluntary endowment and investment life insurance agreements whereby the insurance premium may be paid in instalments over five and more years;

— non-application of requirements4 for mandatory reinsurance with Joint Stock Company Russian National Reinsurance Company (JSC RNRC) of risks under insurance (reinsurance) agreements signed between parties if one of them has a share of at least 25% in the other party’s authorised capital;

— application of the list of offshore zones approved by the Bank of Russia Board of Directors when assessing persons entitled to directly or indirectly dispose of stocks (shares) of insurance companies.

1 Bank of Russia Ordinance No. 6513-U, dated 21 August 2023, ‘On Amending Bank of Russia Regulation No. 781-P, Dated 16 November 2021, ‘On the Requirements for Insurers’ Financial Stability and Solvency’.

2 Considering, among other things, the discussed extension of the Bank of Russia’s special powers to make such decisions provided for by Federal Law No. 46-FZ, dated 8 March 2022, ‘On Amending Certain Laws of the Russian Federation’, Federal Law No. 55-FZ, dated 14 March 2022, ‘On Amending Articles 6 and 7 of the Federal Law ‘On Amending the Federal Law ‘On the Central Bank of the Russian Federation (Bank of Russia)’ and Certain Laws of the Russian Federation with Regard to the Specifics of Changing the Terms and Conditions of a Loan Agreement’ and Article 21 of the Federal Law ‘On Amending Certain Laws of the Russian Federation’.

3 The requirements stipulated by Subclauses 4.2 and 4.3 of Clause 4 of Bank of Russia Ordinance No. 5968-U, dated 5 October 2021, ‘On Minimum (Standard) Requirements for the Conditions and Procedure for Voluntary Life Insurance with Periodic Insurance Payments (Rents, Annuities) and (or) a Policyholder’s Share in the Insurer’s Investment Income, for the Scope and Content of Information Disclosed on Voluntary Life Insurance Contracts Providing for Periodic Insurance Payments (Rents, Annuities) and (or) a Policyholder’s Share in the Insurer’s Investment Income, and also on the Form, Ways and Procedure for Disclosing Such Information’.

4 The requirements established by Clause 1 of Article 13.3 of the Russian Federation Law No. 4015-1, dated 27 November 1992, ‘On the Organisation of Insurance Business in the Russian Federation’.

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