According to the provisions of Article 274, paragraph 2 of Insurance Law until the day of accession of the Republic of Serbia to the European Union, risks may be insured with a foreign insurance company if insurance against those types of risks is not conducted in the Republic of Serbia, as well as other risks which are prescribed by the Government of the Republic of Serbia.
According to the provisions of the Regulation on determining the risks which may be insured, or reinsured with foreign insurance and reinsurance company, which entered into force on 27/06 2015, until the accession of Serbia to the European Union domestic legal and natural persons may insure at a foreign insurance company:
- investment works in abroad which are performed by local companies, as well as equipment to carry out such works – if it is stipulated by the contract for the implementation of these works or by the regulations of the country where the works are
- foreign loans on behalf of insurance the return of these loans – if it is provided for by the contract at the request of the creditor
- ships in the construction or repair – if it is expressly provided for by the agreement concluded with foreign buyer, in other words with the client
- goods to be exported from the Republic of Serbia, or imported into the Republic of Serbia – if the transport of such goods is not done at the risk of domestic natural or legal persons and goods in international transit (transport)
- goods in transport and means of transport in relation to maritime navigation, commercial aviation and launching into space (including cargo and satellites), in other words liability which arising on that basis.
Also until the day of accession of Serbia to the European Union there is a possibility to arrange insurance with a foreign insurance company in the following cases:
- In foreign insurance companies can be insured the assets and employees of domestic companies owned by domestic entities or in joint ownership with foreign entities, which are established to carry out activities in abroad – if it shall be required by regulations of a foreign country, or if it is expressly provided by the act on the establishment of these companies.
- The applicant for approval of clinical trials of medicines and medical devices, and proposer of the registration of the medical device in the Register of medical devices, in accordance with the regulations which governing medicines and medical devices, can arrange insurance with foreign insurance company in case of damage to the health of patients in the period in which a clinical trial of the medicines or medical device shall be carried out, or in favour of the insurance of a third party from the consequences of the application of medical devices that have been entered in the Register of medical devices, within condition that the jurisdiction of a domestic court or other competent authority for decision-making on the request for compensation is accepted by the insurance contract.
- Foreign persons located in Republic Serbia and their property can be insured with a foreign insurance company, unless it is for that property and such persons stipulated mandatory insurance in the Republic of Serbia.
Payment of the premium and collection of the insured amount
According as stipulated by Article 9, paragraph 1, item 14) of the Insurance Law that “risk of no or delayed payment due to insolvency or other events or activities’’ falls into the insurance business which the insurance company in the Republic of Serbia can deal with, that there are no grounds for applying the exception to the rule prescribed by Article 274, paragraph 2 of the Insurance Law, or it isn’t allowed to conclude insurance against this risk with a foreign insurance company.
On the other hand, jobs on the basis of the insurance contract, in terms of the Law on Foreign Exchange Operations, does not include the payment of premiums and the insured amount by domestic legal entity – resident on the basis of the insurance contract which is concluded between a foreign insurance company and legal entity – non-resident as a insurance beneficiary under that contract.
According to the provisions of the Insurance Law and the Law on Foreign Exchange Operations, it isn’t allowed to resident (domestic legal entity – a subsidiary) to receive from non-resident (the parent company), the amount of the sum insured by non-resident (the parent company) which is collected from foreign insurance company based on the occurrence of the insured case – non paypement of claims by residents (domestic legal entities). The same applies when the payment is compensation.
Law on Foreign Exchange Operations by Article 30, paragraph 2), provide possibility to resident (domestic legal entity) to pay insurance premiums based on the insurance contract concluded with a non-resident insurance company within condition that such contract is allowed by the law which governing insurance. Analogously, the payment of insurance benefits to a resident by a non-resident – a foreign insurance company, is permitted only on the basis of insurance contracts concluded in accordance with the provisions of the Insurance Law.
Law on Foreign Exchange Operations by Article 2, item 23 provide that operations based on insurance contract, in terms of this law, include payments of premiums and insured sums based on a contract concluded between a insurance company- non-resident and a resident as insured, as well as between a insurance company – resident and non-resident as insured, in accordance with the law which governing insurance.
Detailed terms and conditions for performing international payment transactions under current and capital transactions in foreign exchange and dinars between residents and non-residents are arranged closer by sublegals which are passed by the National Bank of Serbia, according to the Article 32, paragraph 8 of the Law on Foreign Exchange Operations, respectively by the Decision on Terms and Conditions of Performing Foreign Payment Transactions and by the Guidelines for implementing the Decision on the Terms and Conditions of Performing Foreign Payment Transactions.
By item 7 of the Decision on Terms and Conditions of Performing Foreign Payment Transactions is provided that banks may execute foreign payments and/or transfers abroad only if such payments are in compliance with the Law on Foreign Exchange Operations.
By Reference Code List for Collection of Payments, Payments and Transfers in Foreign Payment Transactions, which is as a Annex 2 part of Guidelines for Implementation of Decision on Terms and Conditions of Performing Foreign Payment Transactions, prescribes the basis on which payments between residents and nonresidents under current and capital transactions can be made, as well as codes of inflow and outflow at prescribed grounds.
In the case when it comes to transactions based on insurance, codebook prescribes the code of inflow and outflow 259 – Insurance – premiums, which includes billing and payment for foreign insurance company in cases where it is allowed to conclude insurance contract with foreign insurance company. When it comes to payment based on insurance codebook prescribes influx codes 260 and 261 – Transfers based on insurance, which, according to the description relating to the collection in which both the foreign insurance company policyholder and beneficiary are residents (reference code 260) and the payment for which the contractor of insurance is insured with a foreign insurer as non-resident and beneficiary is resident (reference code 261), which include claims based on policy.
Therefore, the listed reference codes in the foreign payment operations include the collection from abroad on the basis of insurance contracts that are concluded with a foreign insurance company in accordance with the Insurance Law and after which the insurance beneficiary is resident.