Dear clients and colleagues,

The Belarusian insurance market is strictly controlled by the state. The Ministry of Finance (MoF) is the main government body that supervises the activities of insurers and acts as registration and licensing authority. The Belarusian Civil Code of 7 December 1998 and the Edict of the President of Belarus on Insurance Activities of 25 August 2006 No. 530 lay down the general framework for insurance activities. Under a general rule established by Edict No. 530, the following must insure their valuable interests in Belarus only with insurers authorised to run an insurance business in Belarus: Belarusian legal entities, foreign legal entities that carry out their activities in Belarus, Belarusian citizens and persons with no citizenship that permanently reside in Belarus.

Foreign insurers may enter the Belarusian insurance market only by establishing a Belarusian company registered with the MoF and licensed to carry out insurance activities or by acquiring control over an operating Belarus insurer. Activities of insurers incorporated abroad but without registration and licensing in Belarus are generally prohibited.

Belarusian law provides two types of insurance — voluntary and mandatory. Voluntary insurance is arranged through an insurance agreement between the insurer and the insured. The rules that apply to the particular kind of insurance govern the material provisions of a voluntary insurance agreement. The insurer or the insurers union develops these rules and the MoF approves them. Insurance tariffs under voluntary insurance agreements are established by the insurer subject to approval by the MoF. The procedures and terms of mandatory insurance are set by legislation; insurance tariffs are established by the President of Belarus.

The distinguishing feature of the Belarusian insurance market is that mandatory insurance still prevails over voluntary insurance. In 2011 mandatory payments accounted for about 51.5 percent of all insurance fees collected in Belarus. Voluntary insurance, especially related to life insurance, is still underdeveloped. Under Edict No. 530, mandatory insurance can be arranged only by state-owned insurance companies and insurance companies with a state share of over 50 per cent in their authorised capital. This regulation puts insurance companies that are fully or partially state-owned in an advantageous position.

These restrictions with regard to mandatory insurance (except for mandatory state insurance) are expected to be abolished in the near future. This is declared in a Resolution of the Council of Ministers of the Republic of Belarus and the National Bank of the Republic of Belarus of 28 February 2011 No. 251/6 as one of the measures aimed at implementing the Directive of the President on Development of Entrepreneurial Initiative and Promotion of Business Activities in the Republic of Belarus of 31 December 2010 No. 4.

The leading insurer in Belarus is the state company Belgosstrakh, which was established by the Belarus Council of Ministers. The share of Belgosstrakh in the total volume of insurance fees collected by Belarusian insurers accounts for around 49 percent.

State registration and licensing

Insurance companies and insurance brokers may operate in the Belarusian insurance market only if state-registered with the MoF and with a licence to carry out insurance activities.

To be registered with the MoF, insurance companies and insurance brokers file with the MoF:

  • documents generally submitted for state registration under company laws;
  • information on the professional competence of candidates for the positions of directors, their deputies and chief accountants.

Professional competence is confirmed by a special certification commission formed by the MoF under legally-established procedure. Insurance company founders should also file documents with the MoF confirming the origin of own monetary funds contributed to the authorised capital of the company.

Authorised capital

Edict No. 530 sets the following requirements on the minimum amount of authorised capital of insurers:

  • MEUR 1 equivalent — for insurers involved in non-life insurance.
  • MEUR 2 equivalent — for insurers involved in life insurance.
  • MEUR 5 equivalent — for insurers exclusively involved in the reinsurance business.

The contribution of each founder (the share of each shareholder in the authorised capital) to the authorised capital of an insurance company may not exceed 35 percent of the company’s authorised capital. An insurer must at all times have funds in its bank accounts with Belarus banking institutions in an amount equal to the minimum amount of the insurer’s authorised capital.

Activities of insurers

Insurers may only carry out insurance, investment and other insurance-related activity. Insurance companies that are involved in life insurance may not be involved in other kinds of insurance. An insurance company may be a shareholder in other legal entities but the total amount of an insurer’s contribution to the authorised capital of another commercial company may not exceed 35 percent.

Limitations on foreign investments

An insurance company which is a subsidiary of a foreign investor may carry out insurance business in Belarus only if the foreign investor is an insurance company which has carried out its activity for not less than 10 years under the laws of that foreign country. Note that the scope of activities in which subsidiaries of foreign investors may be involved is limited. These companies may not engage in the following: life insurance, mandatory insurance, including mandatory state insurance, property insurance related to delivery of goods, supplying services or performing contractor work for state needs, and insurance of the valuable interests of Belarus and its territorial administrative units. These restrictions also apply to insurance companies in which more than 49 percent of the authorised capital is formed with foreign investments.

Quota of foreign investments

Foreign investments in the Belarusian insurance sector are limited by quota, currently 30 per cent. The quota of foreign investments is calculated by dividing the total value of all contributions (shares) of foreign investors and their subsidiaries in authorised capital of insurers registered in Belarus by the aggregate authorised capital of insurers registered in Belarus, multiplied by 100. When the quota of 30 percent is exceeded, the MoF must suspend registration of insurance companies with foreign investments and/or issue of licences to carry out insurance activity. In this regard, prior permission from the MoF must be obtained in case of:

  • Increase of authorised capital of insurance companies at the expense of foreign investors and/or insurance companies which are subsidiaries of those foreign investors;
  • disposal of shares in the authorised capital of insurance companies to foreign investors and/or insurance companies which are subsidiaries of those foreign investors;
  • opening of separate subdivisions in Belarus by insurance companies which are subsidiaries of foreign investors and/or where the share of a foreign investor in their authorised capital is over 49 per cent.

Permission is not granted if these actions lead to exceeding the quota. Currently, the quota is approx five percent.

Distribution of insurance products

Insurance companies may distribute insurance products directly, through insurance agents and through insurance brokers. Under Belarusian law, insurance agents and brokers may not act under commission of insurance companies established abroad. Insurance brokers may in no case carry out any activity other than intermediary insurance activity. They may also not be involved in mandatory insurance and reinsurance with regard to types of mandatory insurance. Insurance companies themselves may not act as insurance agents or brokers, i.e., carry out insurance activities under commission of other insurers.


Insurers that operate in Belarus may conclude reinsurance agreements both with Belarusian and foreign insurers, provided that the foreign insurer is not located in an offshore jurisdiction. Reinsurance agreements with foreign companies are allowed only if the state-owned insurance company involved exclusively in the reinsurance business (State Unitary Enterprise “Belarusian National Reinsurance Organization”) refuses to reinsure risks or agrees to reinsure only part of the risks. Belarusian law sets minimum amounts of insurance contributions that must remain at the disposal of the Belarusian insurer if it concludes a reinsurance agreement with a foreign insurer.