This law regulates the supervision, and operation of insurance and reinsurance contracts. Insurance clients are guaranteed the right to have their economic interests protected, the right to information and the right to confidentiality.
All insurance activities are defined as “those which transfer the insurable risk to which third persons are exposed for a premium previously established in a contract”. The two main parties taking part of an insurance contract are the insurer and the insured. The insurer assumes risks to which an insured individual is exposed to. The insured transfers his risks to the insurer.
The law allows collective insurance as a permitted mode of contract. This contract is also celebrated between the insured and the insurance company, but only one insurance policy is shared among multiple people. This contract can be established through direct contributions from each insured member or through one sole contribution from a designated member.