IKBZ and Grand Guardian to offer dollar-denominated service
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The government has allowed IKBZ and Grand Guardian (Shwetaung) Insurance Companies to offer service in US currency after completing the scrutiny on their capital increase by US$500,000, according to Insurance Business Supervisory Board.
The government has allowed IKBZ and Grand Guardian (Shwetaung) Insurance Companies to offer service in US currency after completing the scrutiny on their capital increase by US$500,000, according to Insurance Business Supervisory Board.
The new capital was scrutinised, to prove whether it is white money or black money.
The government initially planned to allow four insurance companies to offer such service. Aside from IKBZ and Grand Guardian (Shwetaung) Insurance, there are First National Insurance and Aung Thitsar Oo Insurance.
“After the scrutiny, the two companies won the permission to start the insurance service. The scrutiny on the remaining two companies is underway,” said Dr Maung Maung Thein, chairperson of the Insurance Business Supervisory Board.
Myanmar has 12 insurance companies.
Insurance firms that plan to offer dollar-denominated services must have capital of at least $500,000. The capital must be deposited at state-owned Myanmar Investment and Commercial Bank (MICB).
Maung Maung Thein said the approval is also based on an assessment of the firms’ performance.
Under the term, the insurers can pay compensation in dollar to those paying premiums in dollar. The maximum compensation for one incident is limited at $50,000.
The government began granting licences to private insurance companies in May last year. It allowed firms to offer life insurance, fire insurance, money-transfer insurance, cash insurance and automobile insurance products. Travel insurance was added to the list in May this year.
If private firms want to offer only life insurance services, their minimum capital is set at Ks 46 billion. This capital is to be registered at Myanma Economic Bank. Sixty percent of this capital can be spent on general purposes. Forty percent is to be registered at Myanmar Insurance, the former sole insurer in the country, for compensation purposes.
Shwetaung Co, the major shareholder of Grand Guardian Insurance, reportedly invested $500 million in the company.
