Bank Collection of Insurance Premiums

The Argentine Superintendence of Insurance (SSN) issued Resolution No. 40,541, on June 14, 2017, and Resolution No. 40,619, on July 10, 2017, in relation to the requirements for the collection of premiums of insurance contracts.

Both resolutions implement measures to replace cash payments, with the purpose of bankarizing the economy and combating tax avoidance, adopting means of collection of premiums that ensure the traceability of the funds involved in transactions.

Resolution No. 40,541, in force since its publication on June 19, 2017, provided that insurance agents, societies of insurance agents and brokers should collect the premiums of insurance contracts exclusively by (I) electronic means of collection authorized by the Argentine Central Bank (BCRA), or (ii) Check under Law No. 25,345 ("cheque cancelatorio") or non-endorsable check ("cheque no a la orden") issued by the insured or policyholder in favor of the insurer. Likewise, as of March 1, 2018, they must display in their legal domiciles, head offices and, where appropriate, their branches, a visible and prominent notice in the main entrance of the establishment, stating that they are not authorized to receive payment of premiums of insurance contracts in cash.

Resolution No. 40,619, in force since its publication on July 12, 2017, established that the means of payment authorized by the BCRA are enabled as means of collecting premiums from insurance contracts. With the exception of the Check under Law No. 25,345 or the non-endorsable Check, the collection of insurance premiums must be recorded by the insurers through fiscal controllers, approved by the Argentine Tax Authority (AFIP), previously authorized by the SSN. Insurers have to issue a receipt for each paid policy.

Both resolutions establish a staggered compliance process:

(a) as of September 1, 2017 the collection of any premium greater than ARS 20,000 annually;

(b) as of December 1, 2017 the collection of any premium greater than ARS 10,000 annually;

(c) as of March 1, 2018 all premium collections, regardless of their amount in the case of Resolution No. 40,541, and in the case of Resolution No. 40,619, the collection of any premium greater than ARS 1,000.