Changes in the insurance market. What you should know!
From January 01, 2024, the new Law of Ukraine "On Insurance" comes into force. Insurers, within six months from the date of entry into force of the Law, must bring their activities in line with its requirements.
The law contains many innovations and in order to cover everything, time and considerable efforts are needed. So, insurance companies should already actively act and implement new legislative requirements.
One of these changes is new requirements for the minimum amount of authorized capital. The law establishes a differentiated approach to the minimum authorized capital of insurance companies: UAH 32 million for non-life insurers and UAH 48 million for life insurance companies, insurers with a license for classes of liability insurance, loans, guarantees and for reinsurance activities .
Consequently, insurance companies whose authorized capital is less than the minimum amount provided for by the Law are obliged to increase it.
It should also be taken into account that after the enactment of the Law and the development and approval by the National Bank of Ukraine of the procedure for agreeing on an increase in the authorized capital, Insurers will have to comply with additional approval procedures. So far, there is no such procedure, but this is not an obstacle for the insurance company to bring the size of the authorized capital to the requirements of the new Law.
We propose to carry out the preparatory work now.
For insurance companies operating in the form of joint-stock companies, we would like to remind you that an increase in the authorized capital can be carried out by increasing the nominal value of shares or additional issue of shares of the existing nominal value in the manner established by the National Commission on Securities and Stock Market.
The process of increasing the authorized capital provides for the active cooperation of the company and the preparation of documents for the National Depository of Ukraine, depository institutions where the company's shares are stored, and the National Securities and Stock Market Commission. At the same time, the requirements of the National Bank of Ukraine must also be observed.
The increase in the authorized capital is a multi-stage and lengthy process. Thus, a pre-started process is the key to success. Entrusting the implementation of the process to professionals is the key to double success.
