The Superintendence of Insurance amended the Argentine reinsurance regulatory framework: (i) allowing more placement of risks with foreign admitted reinsurers; (ii) eliminating the requirement that they register as permanent representation in accordance with article 118 et seq. of the Argentine Companies Law No. 19550; (iii) updating the minimum capital required from local reinsurers; (iv) extending deadlines to prove such capital; and (v) establishing an alternative restructuring plan, among other changes.
On May 4, 2017 the Resolution No. 40422-E/2017 of the National Superintendence of Insurance ("SSN", after its acronym in Spanish) was published, substantially amending the regulatory framework of the reinsurance regime. Some of the main changes are mentioned below.
Minimum Capital to Operate in Reinsurance
The minimum capital required from local reinsurers and insurers licensed to operate in reinsurance as of July 31, 2016 was increased from AR$300 million (approximately USD 20 million) to AR$350 (approximately USD 22.5 million).
The deadlines provided under the regime on Gradual Adequacy of Minimum Capital of such reinsurers and insurers (see "Insurance and Reinsurance: Extension of intermediate deadlines to prove the minimum capital to operate", published in Insurance News No. 2 of March 20, 2017) were extended, with the exception of the first that expired on March 31, 2017, date on which evidence of having reached a capital of AR$60 million must have been provided. The following three deadlines will be December 31, 2017 (instead of June 30, 2017) to provide evidence of having a capital of AR$130 million, December 31, 2018 (instead of September 30, 2017) to evidence AR$250 million (the previous value for this stage was AR$200 million) and, finally, December 31, 2019 (instead of June 30, 2018) to prove a total capital of AR$350 million (the previous total value was AR$300 million).
Dates Minimum Capital According to previous regulation According to current regulation March 31, 2017 AR$60 million AR$60 million June 30, 2017 AR$130 million - September 30, 2017 AR$200 million - December 31, 2017 - AR$130 million June 30, 2018 AR$300 million - December 31, 2018 - AR$250 million December 31, 2019 - AR$350 million Entities that adhered to the regime on Gradual Adequacy of Minimum Capital shall submit certified documentation proving such decision, adopted by its management, together with their financial statements as of March 31, 2017, along with an auditors'...