New rules change the configuration of the Kazakhstan reinsurance market.
In January of this year the Regulator amended the reinsurance rules though tightening of requirements to reinsurance companies. In particular, the insurance premiums for foreign reinsurers were limited to 25% (save for very large limits of responsibility); rating requirements were established for foreign reinsurers with linking of their absence to the size of equity of Kazakhstan insurer (the lower the rating, the higher the equity); net retention of one insurance class was increased from 25% to at least 40%.
New terms and conditions are designed to encourage insurance companies to cooperate with reliable reinsurers, generate the capitalization and increase the local content in reinsurance.
With tightening of the local reinsurance legislation in the medium term, it is possible that Kazakhstan will saw the activation of generation processes of insurance and reinsurance pools as well as mutual insurance companies — as an alternative of appeal of primary insurer to reinsurer.
