do business in the Dominican Republic - Pellerano & Herrera

More documents

Recommendations

Info

DOING BUSINESS INTHE DOMINICAN REPUBLICInsurer.Any company duly authorized to carry out exclusively operations for executinginsurance and reinsurance agreements and resulting activities, eitherdirectly or through intermediaries.Intermediary. Any person or company authorized to act between insurers andinsured persons, whether as general agent, local agent, insurance broker, personalor general insurance agent, or to act between insurers and reinsurers.Insurance Adjuster. Any person or company authorized to investigate and/or tovaluate damages caused by events, being able to negotiate the amount of claimsresulting from the execution of insurance contracts.d) Requirements for Establishment. In order to operate as insurer or reinsurer,a minimum paid-in capital of 8.5 million pesos, or the equivalent of US$500,000,is required. Foreign insurers or reinsurers must have been operating for morethan five years under the laws of their country of origin, and must be providedwith a certificate issued by the state body that supervises insurance companiesin that jurisdiction.The Superintendence of Insurance has to approve the drafts of policies, insuranceapplications, premiums, reinsurance programs and other forms to be usedby the company.Capital requirements for intermediaries and adjusters are the following:One million pesos, or the equivalent of US$200,000 to operate as generalagent.RD$200,000, or the equivalent of US$12,000 to operate as insurance broker.RD$50,000, or the equivalent of US$3,000 to operate as local agent, personalinsurance agent, general insurance agent or adjuster.e) Guarantee Fund. Insurance and reinsurance companies must constitute aspecial fund that will guarantee exclusively the obligations resulting from insurance,reinsuranceand bond contracts,but its use shall be subject to the existenceof a final judgment.The Superintendence of Insurance shall by resolution fix theminimum initial amount of this fund, taking into account the classes of insurancetransacted, without exceeding the following sums:1.5% for companies having net earned premiums for an amount of up to 50million pesos.RD$750,000 plus 1% of amounts exceeding 50 million pesos, for companieshaving net earned premiums for more than 50 million pesos and up to 100million pesos.0.5% for companies having net earned premiums for more than 100 millionpesos.Mandatory contributions to the Guarantee Fund for intermediaries and adjustersare also established.84f) Reserves and Prohibitions. Insurance and reinsurance companies must havethe following reserves or capital surpluses: mathematical reserves, specific
Pellerano & HerreraAttorneys at lawreserves, provisory reserves and reserves for catastrophic risks. Specific reservesmust take the form of financial instruments of local financial institutions that maybe repurchased on demand.Other reserves may take the form of securities issuedor backed up by the State,loans with first-rank mortgages as collateral,shares andsecurities of national companies operating in certain activities, real estate locatedin the country, loans to policy-holders with their own life insurance policiesas collateral, term deposits, financial instruments that may be easily liquidated,low-risk securities transacted at the Stock Market or investments in foreign currency.The following activities are prohibited to insurers and reinsurers:To serve as jointly liable agent under bail or bond agreements or other typeof contracts.To grant loans with their own stock as collateral.To grant mortgage loans for more than three years that are not repayable ininstallments.To grant loans to persons residing abroad.To have an interest in the capital of insurance brokers, local agents andadjusters.To invest more than 30% of their reserves in related companies.g) Solvency and Liquidity. The solvency level required for insurers and reinsurersshall be calculated in relation to premiums (for instance, 27% of earned premiums,exceptfor health insurance and collective life insurance,that shall be 5%)and in relation to losses. Furthermore, the law defines regulatory capital (“patrimoniotecnico”) and adjusted regulatory capital, which shall be higher than theminimum solvency ratio required.Minimum liquidity requirements are the following:40% of reserves to cover current risks on earned premiums.3% of reserves to cover current risks on earned premiums for health andcollective life insurance.100% of reserves for expected losses.15% of the relation between mathematical reserves and insurance policyloans.10% of minimum solvency ratio.h) Sanctions and Appeals.Law 146-02 provides administrative sanctions for noncompliancewith the legal obligations, which include fines of up to 50 minimumsalaries, to be applied by the Superintendence of Insurance.The decisions of the Superintendence of Insurance may be appealed with theMinister of Finance within 15 days after the date of notice.These decisions maybe appealed with the Court for Tax Issues.85
Page 1 and 2:
DOING BUSINESS INTHE DOMINICAN REPU
Page 3 and 4:
DOING BUSINESS INTHE DOMINICAN REPU
Page 5 and 6:
FOREWORDA place to invest ...The Do
Page 7 and 8:
Pellerano & HerreraAttorneys at law
Page 9 and 10:
Page 11 and 12:
Page 13 and 14:
Page 15 and 16:
Page 17 and 18:
Page 19 and 20:
Page 21 and 22:
Page 23 and 24:
Page 25 and 26:
Page 27 and 28:
Page 29 and 30:
Page 31 and 32:
Page 33 and 34:
Page 35 and 36: Pellerano & HerreraAttorneys at law
Page 39 and 40: INTERNATIONALTRADEInternational tra
Page 57 and 58: MAININVESTMENTSECTORSThe Dominican
Page 85: Pellerano & HerreraAttorneys at law
Page 95 and 96: LEGAL FRAMEWORKFOR BUSINESSACTIVITI
Page 125 and 126: Digital signature of the Certificat
Page 137 and 138:
Page 139 and 140:
Page 141 and 142:
Page 143 and 144:
Design: Lourdes Saleme y AsociadosP
show all

do business in the Dominican Republic - Pellerano & Herrera

Create successful ePaper yourself

Delete template?

Save as template?