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. Last Updated: 07/27/2016

Yeltsin Decree Restricts Foreign Insurers




President Boris Yeltsin has signed insurance law amendments banning foreign-licensed insurers from insuring the property of Russian companies and individuals.


The amendments, which went into force upon publication Sunday in the official government daily Rossiiskaya Gazeta, limit foreign-licensed companies' activity in Russia to re-insurance and mutual insurance for Russian companies.


Previously, foreign-licensed insurers could insure property of both Russian companies and individuals but few are active on Russian soil. They can still offer other forms of insurance.


Foreign firms can hold 49 percent stakes in joint ventures with Russian insurers. Few partnerships exist.


The amendments also raise minimal authorized capital for companies not involved in life insurance to at least 25,000 times the minimum wage, for companies involved in life insurance to 35,000 times the minimum wage and for companies involved only in re-insurance to 50,000 times the minimum wage.


Russia's minimum monthly wage is 83.49 redenominated rubles ($13.98). Previously, a minimum required authorized capital for insurers was a flat 2,000 rubles.


Insurance companies are required to comply with the new capital rules by Jan. 1, 1999, or their licenses will be withdrawn, the document says.