Mr. Thompson to Mr. Olney .

No. 418.]

Sir: I have the honor to transmit herewith copy and translation of decree No. 294, of September 5, 1895, providing regulations for the operation of foreign life insurance companies in Brazil.

I have, etc.,

Thos. L. Thompson
[Inclosure in No. 418.—Translation.]

Decree No. 294, of September 5, 1895, regulating the foreign life insurance companies operating in the territory of Brazil.

I, the President of the Republic of the United States of Brazil, make known that the National Congress has decreed and that I sanction the following law:

Article 1. Life insurance companies authorized to operate in Brazil, and whose head offices are situated in a foreign country, shall present to the Government and publish in the press, within sixty days of the promulgation of this law, a minute relation of all the insurances guaranteed by them and in force within the territory of the Republic, indicating with the number of each policy the name of the person insured, as well as the amount insured, the premium or yearly payment, and the amount of reserve belonging to the said policy on the 1st of January, 1894.

Article 2. The total of the reserves of all the policies in force in Brazil on that date shall be invested in national securities, such as real estate within the territory of the Republic, mortgages upon property and real estate, railroad shares, banks, or industrial enterprises or others established in Brazil, or in deposits for the term of one year at least in banking establishments operating in Brazil.

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Article 3. Such life insurance companies shall prove before the Government, within sixty days of the promulgation of this law, that the total of the reserves treated of in the preceding article is employed in conformity with the requirements of said article, publishing such proof in the press, in order to secure the inspection of those interested.

Article 4. From the date of the promulgation of this law, after the necessary amount for general expenses, death losses, dividends, and other payments to the insured shall have been deducted from the total of the premiums received by those companies in Brazil, all of the balance shall be converted in the manner set forth in the said article 2.

Article 5. The said insurance companies shall be obliged to require their principal agency in Brazil to decide upon all insurance applications made here, rejecting or accepting the same, and in the latter case issuing the definite policies.

Sole paragraph: If, within fifteen days of the receipt of the application by the principal agency, it be not rejected and the amount corresponding to the first premium paid by the applicant be received by the agency, the insurance will have full effect the same as if the policy were issued, the company then being unable to reject the same.

Article 6. The recognition and liquidation of the death losses, and of the reclamations of the insured, must also be considered and definitely decided upon by the principal agency in Brazil.

Article 7. The companies must, at the end of each half year, and within the two months following, present to the Government and publish in the press a minute relation of all the premiums received corresponding to the life insurances contracted to date, from sixty days after the promulgation of this law.

Article 8. Within sixty days of the promulgation of this law the companies to which it refers shall communicate officially to the minister of finance that they accept the execution of the obligations prescribed in it.

Sole paragraph: To the company failing to do so, will be suspended the permission of making new insurance contracts in Brazil, being limited henceforth to receiving the premiums on the insurances in force up to that date, and to execute the compromises taken in accordance with the respective contracts.

Article 9. Given this hypothesis, if, later on, the company should decide to accept the obligations of the present law it shall petition the Government for authorization, the same as by the present laws must be done by foreign companies that desire to operate in the territory of the republic, and the authorization being conceded, it shall make a new guarantee deposit in the national treasury.

Sole paragraph: The company which without authorization and given the hypothesis of article 8 and its paragraph accepts new contracts of insurance will have to turn over to the treasury 10 per cent of the premiums which it may have received for the same until the referred to authorization shall have been solicited and obtained.

In case of nonpayment within fifteen days of the intimation by the fiscal department the required amount shall be collected from the deposit which, as a guaranty in virtue of the law, the company may have made in the national treasury when it commenced to operate.

Article 10. The Government will expedite regulations for the good execution of this law.

  • Prudente J. de Moraes Barros.
  • Francisco de Paula Rodrigues Alves.