Published and draft legislation - Colombia

Insurance services through correspondents

External Circular 049/2016

The Colombian Financial Supervisor (SFC) has included insurance companies operating in Colombia on the list of companies authorised to use local correspondents to provide services.

In its External Circular 049, the SFC adds new instructions to its Basic Legal Circular (Circular Básica Jurídica) regarding the conditions and manner in which correspondents may provide services to insurance companies.

Within these instruction, the SGC establishes that policies sold through correspondents must meet the conditions of universality, simplicity, standardisation and mass commercialisation. It also includes a list of the branches of insurance that may be sold by correspondents, including obligatory transit accident insurance (SOAT), funeral insurance, unemployment insurance, individual life and personal accident insurance and fire insurance.

It also allows the correspondents of insurance companies to bring forward the collection of premium payments and indemnity payments for any branch of insurance, the delivery of the supports or evidence, and the delivery and receipt of copies of policies and their appendices, general and particular conditions or extracts, certificates and other documents that may be necessary to lodge a claim, information documents and, in general, any information related to the insurance being sold through the correspondents.

The new instructions establish the rules for the insurance companies wishing to provide services through correspondents with respect to training, delivery of contractual documents, implementation of mechanisms for liaison with the correspondents and simplified procedures for lodging claims against their policies.  

Finally, the new instructions prohibit insurance brokers from acting as correspondents for the insurance companies.

The aim of this standard is to facilitate access to insurance for people leaving far from urban centres. Such initiatives are lauded by everyone working in microfinance.

 

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