The existence of an insurance market contributes to the safety of people and their assets and, above all, to the development of any business branch. Only through resources to insurance may businessmen undertake a transfer of the different risks that hang over them, be they risks relating to the business itself, their assets or the ability of their employees. The implantation of the business of insurance in Timor-Leste is thus a decisive factor for the development of the private sector and consequently for the overall development of the country.
Law N. 6-2005 approves the regime for the licensing, supervision and regulation of insurance companies and insurance intermediaries, with a view to establishing a sound, legal basis for launching the business of insurance in Timor-Leste. In effect, doing the business of insurance turns out to be of paramount importance to various sectors. In addition, the law establishes the Banking and Payments Authority (BPA) of Timor-Leste, defines its purpose, powers, and responsibilities.
The law covers the following topics:
1. Regime for the Licensing, Supervision and Regulation of Insurance Companies and Insurance Intermediaries
2. Functions and Powers of the BPA
3. Licensing, Commencement and Cessation of Business
4. Insurance Intermediaries
5. Prudential Aspects
6. Financial Aspects
7. Governance and Internal Monitoring
8. Market Practice and Consumer Protection