Approximately 20 years ago Ukraine started to strengthen its legislation on insurance activity. The State regulation in this sphere is aimed at increasing insurance protection of legal entities and individuals.

Current Ukrainian insurance legis­lation can be considered quite prog­ressive.

First, it allows branch offices of non-resident insurance companies to carry out insurance activity in Ukraine (provided that all registra­tion and licensing procedures are met).

Second, a non-resident insurance company is entitled to provide some insurance services in Ukraine, inter alia, reinsurance, insurance broking, ancillary insurance ser­vices etc.

Third, there are more than 20 types of voluntary insurance and more than 30 types of obligatory insurance in Ukraine. In addition, co-insurance and reinsurance are envisaged by Ukrainian Law.

Thus, insurance can be viewed as a prospective area for foreign invest­ment.

The main acts governing insurance activity are the following:

          The Law of Ukraine "On the Insu­rance",

          The Law of Ukraine "On the Obli­gatory Civil Liability Insurance of the Transport Vehicles Owners",

          The Resolution of the CMU "On the Reinsurance in the Non-resident Insurance (Reinsurance) Company";

          The Instruction of the NCRFSMU "On the Inclusion of Information on the Companies Intending to Obtain Insurer Status into the State Register of Financial Institutions",

          The Instruction of the NCRFSMU "On Licensing Conditions for the Insurance Activity",

          The Instruction of the NCRFSMU "On the Registration of Insurance and Reinsurance Brokers and Maintenance of the State Register of Insurance and Reinsurance Brokers",



          Approves regulations governing obligatory insurance;

          Approves regulations governing reinsurance by non-resident insurance company;

          Defines license fees.

National Commission for the Regulation of the Financial Services Markets of Ukraine

          Maintains State register of financial institutions;

          Issues licenses on the insurance activity;

          Carries out compliance assessments of insurance com­panies;

          Registers insurance (reinsurance) brokers;

          Maintains State register of insurance (reinsurance) brokers;

          Registers reinsurance agreements.

Motor (Transport) Insurance Bureau of Ukraine

          Grants insurance companies with the status of MTIBU's Member;

          Manages centralized insurance reserve funds of MTIBU.

Regulation and Licensing

In general, the following entities are entitled to perform insurance activity in Ukraine on the basis of respective license issued by the NCRFSMU:


It is worth noting that share capital of the insurance company which is in charge of life insurance in any case should not be lower than equi­valent of EUR 10 million. If to talk about other types of insurance this minimum level is much lower and equals to equivalent of EUR 1 million.

In addition, the share capital of the insurance company should be paid in monetary form. However, 25 % of it can consist of securities issued by the State. Intangible assets and loan proceeds could not be used for the share capital formation. 

Taking into account the aforemen­tioned, two procedures should be met by a legal entity in order to obtain the right to provide insu­rance services in Ukraine:


In order to obtain the status of a financial institution the applicant should file a set of documents with the NCRFSMU. The NCRFSMU reviews it and makes its decision within 30 days. If the documents comply with the current legisla­tion, the NCRFSMU grants the applicant the status of financial institution and includes it into the State register of financial institu­tions. Such status is confirmed by a respective Certificate.

In order to obtain the license, the applicant should also file a set of documents with the NCRFSMU. The term of its consideration is 30 calen­dar days. In case of a positive resolution, the applicant should pay the license fee and obtain the respective license. The license fee amounts to UAH 12,500 (approx. EUR 500) for each type of insurance activity.

The insurance company having obtained the license for the life insu­rance still does not have the right to provide other insurance services. Such license has no expiration date.

Insurance companies are not able to carry out other types of activity except for insurance, reinsurance and activities related to the insu­rance reserves.


Insurance activity can be carried out through the following:

·         Intermediaries;

·         Resident and non-resident insurance (reinsurance) companies.

Intermediaries are the following: insurance (reinsurance) brokers and insurance agents.

Intermediary activity of brokers and agents is their exclusive activity. It could include the following: infor­mation services, consulting, services related to the execution and enforce­ment of insurance agreements etc.

Insurance brokers execute insurance agreements on their behalf on the basis of brokerage agreement with the persons looking for insur­ance. Legal entities or individual entrepreneurs could be registered as insurance brokers. The regis­tration of insurance brokers is performed by the NCRFSMU within 30 days following the receipt of the required set of documents.

Insurance agents act on behalf of the insurance company and carry out some part of its activity. For ex­ample, they can execute insurance agreements, obtain insurance pay­ments, and provide insurance com­pensations.

Insurance agents act as a representatives of the insurance company on the basis of respective agency agreements. Insurance agents ob­tain rewards from the insurance company. Legal entities or indivi­duals could be insurance agents.


The insurance company is able to insure the performance of its obli­gations toward those it insures. In this case the insurance company refers to other insurance (reinsurance) companies.

The reinsurance agreements with non-residents must be registered by the NCRFSMU. The reinsurance agreements with residents must be registered by the NCRFSMU provi­ded that the total amount of reinsu­red payments equals to or exceeds UAH 1 million, (approx. EUR 40,300) within a calendar year.

The insurance company files with the NCRFSMU the respective appli­cation as well as copies of the reinsu­rance agreement. The NCRFSMU has 10 business days for the registration of the agreement or to deny registration.

Contemplated Reforms

It is expected that the legislation governing activities of insurance companies will be harmonized with the EU Law.

The information contained herein is not a legal advice or clarification of the current legislation. 

If you need more information, please refer to Lavrynovych & Partners:
www.lp.ua | office@lp.ua

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