In September 2012, the Government of the Democratic Republic of Congo (DRC) submitted to the Parliament a bill of law on the Insurance Code for discussion and adoption prior to its promulgation by the head of State and publication in the official gazette in accordance with articles 100, paragraph 2 and 130 to 137 of the DRC constitution.

During the period starting from 1885 the year of the creation of the Congolese State formerly known as ‘’Etat Indépendant du Congo” (E.I.C) until 1966, the insurance sector was dominated by foreign companies from Belgium, France, Holland, Great-Britain and Canada such as, for example, CHARLES LEJENNE, IMMOAF, BOES BEGAULT, etc.

Some years after the independence of the Congolese state, the Congo decided to set up a public company known as “Société Nationale d’Assurances“ (SONAS) created by Ordinance-Law n° 66-622 of November 23, 1966; By Ordinance-Law n°240 of 2 June 1967, SONAS was granted the monopoly on all insurance activities over the territory of the DRC. The enactment of this Ordinance-Law was motived by the idea to put an end to the liberalization of the insurance activities that resulted in outflows of capital from the DRC to rich developed countries.

Despite the fact that the SONAS did not perform well, its monopoly status remained unchanged until today making hard for DRC or foreign companies to operate in the insurance sector in a country as big as the DRC with a population of over 65 million. However, it is obvious that the insurance sector plays an important role in the emergence of modern economies.

This is the reason why the DRC Government drafted this bill of law on the Insurance Code with a view to liberalize the insurance sector which generates a lot of incomes. The preamble of the bill states that “the bill of law on the Insurance Code is one of the most important measures taken by the Government in order to modernize and liberalize certain economic and financial activities of the country. In fact, the legal security is one of the major concerns of the investors and a prerequisite to the economic development of the country and to the improvement of the citizens’ living conditions (…).  The insurances activities are part of the competitive sector of the economy, and therefore, it is not recommended for the State to play a predominant role in such sector. However, the State should set forth the conditions in which new companies including mutual insurance organizations may be authorized to operate in this sector. (…) ».

With its 520 articles, the bill of law is a valuable legal tool in terms of legal security for both national and international investors, but also for insured, subscribers, beneficiaries of insurance agreements and capitalization through the creation of an organ of control known as “Regulation and Insurances Control Authority”.

The bill of law also creates an Automobile Guarantee Fund that covers claims when the person liable for injuries is unknown or is not insured, except when there is a legal derogation to the insurance obligation. The amount of the coverage by the Automobile Guarantee Fund will be set forth in the regulation texts to be adopted by the Minister in charge of the insurance on proposal of the Regulation and Insurances Control Authority. It will cover medical care costs, compensation to the victims for damages resulting from car related accidents.

The bill of law envisages the existence of other Guarantee Funds for mandatory insurances to be created by Decree of the Prime Minister on proposal of the Minister in charge of Insurances following a deliberation by the Council of Ministers. 

In addition to the insurance companies, the bill entrusts insurance activities to mutual insurance organizations whose formation, operation and dissolution are governed by the Regulation and Insurance Control Authority.  Concerning foreign companies, they will be authorized to operate only within the specified legal framework provided by the Insurance Code.

The bill of law is made up of seven volumes:  volume I - insurance operations; volume II - insurance companies ; volume III - Institutional framework and State control ; volume IV - general agents, brokers and other insurance intermediaries ; volume V - specific organizations ; volume VI - accounting and tax regimes ;and volume VII - transitional, abrogative and final provisions.

This Insurance Code will offer many opportunities for national or foreign investors who will benefit from this modern legal framework provided by the Insurance Code which should enter into force in a very near future in the DRC. As of today, the insurance sector is still largely unexploited.

The bill of law on Insurance Code is currently under discussion by the Congolese Parliament.