There is insufficient information publicly available regarding Algeria's compliance with the revised Insurance Core Principles issued by the International Association of Insurance Supervisors in October 2003. Since the end of the 1980s, according to the World Bank's 2004 Financial Sector Assessment, Algerian authorities have embarked upon a wide-ranging and credible modernization of laws and regulations governing financial intermediation. This program applies to banks, insurance companies, securities, and financial markets. The modernization program has also led to important changes in the Commercial Code, including the reform of creditors and shareholder rights. As noted in a 2004 Financial System Stability Assessment by the International Monetary Fund, the insurance sector in Algeria was liberalized in 1995 under Insurance Ordinance No. 95-07. The Ordinance was amended in 2006 by the new Insurance Law No. 06-04 but remains insignificant. The National Insurance Council (CNA), which was established under the 1995 Insurance Ordinance, is the supervisory and regulatory authority for the insurance sector in Algeria. The Minister of Finance presides over the CNA.

General Overview

The insurance sector in Algeria was liberalized in 1995 under Insurance Ordinance No. 95-07. However, the 2004 Financial System Stability Assessment (FSSA) by the International Monetary Fund (IMF) reports that it remains insignificant. In a 2004 Financial Sector Assessment (FSA), the World Bank notes that since the end of the 1980s, Algerian authorities have embarked upon a wide-ranging and credible modernization of laws and regulations governing financial intermediation. This modernization program applies to banks, insurance companies, securities, and financial markets. However, bankruptcy and life insurance are not yet regulated.

As a result of weak insurance supervision in developing countries, a project was launched jointly in October 2002 by the International Association of Insurance Supervisors (IAIS), the World Bank, the Financial Sector Vice Presidency, and the Stability Institute to develop a Core Curriculum on Insurance Supervision (CCIS), as noted on the Financial Sector Reform and Strengthening (FIRST) Initiative website. The CCIS project is under the oversight of an IAIS Task Force reporting directly to the Executive Committee of the IAIS, which is composed of active senior insurance supervisors, representatives from the IAIS, and the World Bank. In June 2005, as part of the second CCIS seminar, the FIRST Initiative launched a "Regional Training Seminar for Insurance Supervisors" project for the Middle East & North Africa (MENA) region, which was completed in November 2006. The aim of the project was to strengthen insurance supervision in the MENA region through the training of insurance supervisors. Although participant feedback called the seminar successful, objectives related to insurance supervision were not achieved.

The 1995 Insurance Ordinance was amended in 2006 by the new Insurance Law No. 06-04. This law allows foreign insurers to operate directly in the Algerian insurance market through franchises, as stated on the Oxford Business Group website. The National Insurance Council (CNA), which was established under the 1995 Insurance Ordinance, is the supervisory and regulatory authority for the insurance sector in Algeria. The Minister of Finance presides over the CNA. The CNA website discloses that the Council also grants licenses to insurance companies and cooperates with other national institutions in the elaboration of texts instituting regulatory norms for risk management and preventive measures.

Algeria is not a member of the IAIS, and insurance companies in Algeria account for less than 3% of total financial system assets, according to the World Bank's 2004 FSA. As of 2004, there were six state-owned and two mutual insurance companies, six private insurers, and one state-owned reinsurer. During the 2005 fiscal year, the Algerian insurance industry grew by 16%, as noted on the Oxford Business Group website. To this date, the insurance sector is dominated by four state-owned insurers, which control about 87.7% of the insurance market, per the same report.

The Principles

ICP 1 Conditions for effective insurance supervision

II

There is insufficient information publicly available addressing Algeria's compliance with this principle.

ICP 2 Supervisory objectives

II

CNA's supervisory objectives, according to its website, are to improve the functioning of insurance and reinsurance companies and to guarantee the solvency of insurance companies in order to protect the interests of the insured and the beneficiaries of contracts. It also encourages insurance companies towards greater professionalism in risk management and preventive measures. Nevertheless, the available sources do not directly address Algeria's compliance with this principle.

ICP 3 Supervisory authority

II

The CNA, which was established under the 1995 Insurance Ordinance No. 95-07, is the supervisory and regulatory authority for the insurance sector in Algeria. The CNA also grants licenses to insurance companies, as noted on its website. The Minister of Finance presides over the CNA. Nevertheless, the available sources do not directly address Algeria's compliance with this principle.

ICP 4 Supervisory process

II

There is insufficient information publicly available addressing Algeria's compliance with this principle.

ICP 5 Supervisory cooperation and information sharing

II

As noted on its website, the CNA cooperates with other national institutions in the elaboration of regulatory norms for risk management and preventive measures. However, Algeria is not a member of IAIS. Nevertheless, the available sources do not directly address Algeria's compliance with this principle.

ICP 6 Licensing

II

There is insufficient information publicly available addressing Algeria's compliance with this principle.

ICP 7 Suitability of persons

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There is insufficient information publicly available addressing Algeria's compliance with this principle.

ICP 8 Changes in control and portfolio transfers

II

There is insufficient information publicly available addressing Algeria's compliance with this principle.

ICP 9 Corporate governance

II

There is insufficient information publicly available addressing Algeria's compliance with this principle.

ICP 10 Internal control

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There is insufficient information publicly available addressing Algeria's compliance with this principle.

ICP 11 Market analysis

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There is insufficient information publicly available addressing Algeria's compliance with this principle.

ICP 12 Reporting to supervisors and off-site monitoring

II

There is insufficient information publicly available addressing Algeria's compliance with this principle.

ICP 13 On-site inspection

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There is insufficient information publicly available addressing Algeria's compliance with this principle.

ICP 14 Preventive and corrective measures

II

There is insufficient information publicly available addressing Algeria's compliance with this principle.

ICP 15 Enforcement or sanctions

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There is insufficient information publicly available addressing Algeria's compliance with this principle.

ICP 16 Winding-up & exit from the market

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There is insufficient information publicly available addressing Algeria's compliance with this principle.

ICP 17 Group-wide supervision

II

There is insufficient information publicly available addressing Algeria's compliance with this principle.

ICP 18 Risk assessment and management

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There is insufficient information publicly available addressing Algeria's compliance with this principle.

ICP 19 Insurance activity

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There is insufficient information publicly available addressing Algeria's compliance with this principle.

ICP 20 Liabilities

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There is insufficient information publicly available addressing Algeria's compliance with this principle.

ICP 21 Investments

II

There is insufficient information publicly available addressing Algeria's compliance with this principle.

ICP 22 Derivatives and similar commitments

II

There is insufficient information publicly available addressing Algeria's compliance with this principle.

ICP 23 Capital adequacy and solvency

II

There is insufficient information publicly available addressing Algeria's compliance with this principle.

ICP 24 Intermediaries

II

There is insufficient information publicly available addressing Algeria's compliance with this principle.

ICP 25 Consumer protection

II

There is insufficient information publicly available addressing Algeria's compliance with this principle.

ICP 26 Information, disclosure & transparency towards the market

II

There is insufficient information publicly available addressing Algeria's compliance with this principle.

ICP 27 Fraud

II

There is insufficient information publicly available addressing Algeria's compliance with this principle.

ICP 28 Anti-money laundering/ Combating the Financing of Terrorism

II

On February 5, 2005, as noted in a 2007 U.S. Department of State International Narcotics Control Strategy Report, Algeria enacted a new Law on the Prevention and Fight against Money Laundering and Financing of Terrorism, replacing the 1994 Ordinance No. 95-11, to bring Algerian law into conformity with international standards and conventions. Per the same report, the Law offers guidance for anti-money laundering and combating the financing of terrorism, institutional and judicial cooperation, and penal provisions. The Cellule du Traitement du Renseignement Financier (CTRF) - Algeria's Financial Intelligence Unit - was established in 2002 within the Ministry of Finance as an independent legal entity. The new legislation further strengthens the powers of the CTRF, and extends money laundering control to non-bank financial institutions, including insurance agents, lawyers, accountants, stockbrokers, pension managers, and dealers of precious metals and antiquities. Nevertheless, the available sources do not directly address Algeria's compliance with this principle.