The Association proposes setting out the basis on which an insurance broker obtains the right to manage a pool: an open tender for single pools in compulsory classes of insurance, requirements for the broker, a five-year management term, quality indicators and a procedure for replacing the manager.
The Association of Insurance Agents and Brokers has put forward an initiative to establish clear rules for managing insurance pools: on what grounds an insurance broker is granted the right to manage a pool, through what tender, for what term, what requirements the broker must meet and how management passes to another broker. This matters most for single insurance pools in compulsory classes of insurance, where the managing broker effectively becomes the sole intermediary for an entire market segment.
ASAB
Rules for managing insurance pools
Grounds and requirements for the broker, an open tender for single pools in compulsory classes of insurance, the management term and the procedure for replacing the manager.
NowA broker “may be engaged” by agreementArt. 13(9)
We proposeTender, requirements, 5-year termArts 13, 17, 43
Where it matters mostSingle pools in compulsory classesArt. 3(18-3)
1. Why a single pool is a question of competition
An insurance pool is an association of insurance companies jointly carrying out insurance activity in a particular class, type of insurance or risk under a joint activity agreement concluded for a fixed term between the members or between the members and an insurance broker (subparagraph 18-3) of Article 3 of the Law “On Insurance Activity”). A broker engaged to manage a pool performs the functions of the lead insurer and signs co-insurance contracts (Article 13(4) and (9)), and its remuneration is paid by the pool members (Article 17(7-1)).
When a pool is set up for a compulsory class of insurance and becomes the only channel for concluding contracts, its manager gains an exclusive position: all policyholders in that class come to one broker, and other brokers are shut out of the segment. This is how, for example, the single insurance pool for compulsory professional liability insurance of medical workers, set up in 2024, is organised: its management has been entrusted to an insurance broker. Yet the law does not say why that particular broker obtained the right or for how long. We examined the gaps in the law in detail in the article “Managing insurance pools: legal uncertainty for brokers”.
QuestionWhat the law saysProvision
Who may manage a poola licensed broker by agreement with the membersArt. 13(9)
How the broker is chosennot established—
What requirements it must meetonly holding a licenceArt. 13(9)
For what termthe term of the joint activity agreement, with no minimum or maximumArt. 13(2)(5)
How to replace the managernot established—
Who sets the procedurethe authorised body — the procedure and specifics of pool activityArt. 43(26)
2. Grounds: when a pool can be entrusted to a broker
The Association proposes enshrining that the right to manage a pool is granted to a broker not by private arrangement but on the basis of an open tender, and only if the broker meets the established requirements. Refusal of admission to the tender is possible only on grounds expressly stated in the rules and must be justified in writing.
Requirements for a broker managing a pool
Licence and reputation
1Experienceat least three years as an insurance broker in the relevant line of business
2No violationsno outstanding supervisory response measures and no licence suspensions in the past two years
3No conflict of interestthe broker is not affiliated with the pool members and discloses related parties
Finance and liability
4Own capitalnot below an increased minimum for pool managers
5Liability insurancethe broker’s professional liability insured for an amount commensurate with the pool’s volume
6Separate accountpool premiums and payouts held in a separate bank account
Technology
7IT platformonline issuance, accounting for co-insurance contracts, personal accounts for policyholders
8Integrationsdata exchange with the insurance database and with each pool member
9Data protectioninformation security, backups, business continuity
People and service
10Claims settlementa claims intake service and monitoring of payout deadlines
11Teamstaff experienced in underwriting and claims handling, internal control
12Regions and supportservicing policyholders nationwide, a contact centre
3. Tender for pool management
For a single pool in a compulsory class of insurance the tender should be mandatory; for a voluntary pool it should be held at the members’ discretion. The procedure is set by the authorised body, and the tender itself is held openly: with a public announcement, uniform requirements and published results.
How the tender works
1AnnouncementA public announcement setting out the terms: class of insurance, term, requirements, evaluation criteria and maximum remuneration. Applications are accepted for at least 30 days.
2AdmissionChecking compliance with the requirements; admission may be refused only on grounds set out in the rules and with written reasons.
3EvaluationPoints for quality of service and the IT platform, claims settlement, experience and team, and the amount of remuneration; price is not the only criterion.
4DecisionA commission including the insurers that are pool members and an association of insurance companies and brokers; results and scores are published.
5AgreementA joint activity agreement for the management term with quality indicators and a reporting procedure.
4. Management term and replacement of the manager
Managing a pool requires investment in an IT platform, integration with the insurance database, a claims settlement service and a team. Such investment pays off over years, so the term should be long enough for the broker to recoup it, yet limited so that the market can regularly change the manager. The Association proposes a five-year term with a new tender on its expiry.
NowWe propose
Management termany, by agreement5 years, then a new tender
Quality of worknot measuredindicators: payout times, complaints, platform availability; annual report
Early terminationno procedure establishedonly for breach of the indicators or the law, with prior warning
Handoverno procedure establishedcontracts, data and open claims are transferred to the new manager under a transfer deed
Broker’s investmentnot protectedcompensation of the unamortised portion on early termination through no fault of the broker
5. How a broker can prepare
A broker planning to take part in a tender can prepare in advance, even before the rules are adopted. The same steps are needed today to manage voluntary pools:
Capital and insuranceown capital with a buffer, a professional liability policy
→
Platformonline issuance, co-insurance accounting, database integrations
→
Claims settlementclaims intake rules, deadlines, a contact centre
→
Team and controlunderwriters, claims specialists, internal control
→
Applicationdocuments, remuneration calculation, a pool work plan
6. Text of the amendments
Amendments to the Law “On Insurance Activity”
Article 13(9)
Now: “Insurance brokers holding the relevant licence of the authorised body may be engaged to manage the activity of an insurance (reinsurance) pool, subject to an agreement between the members of the insurance (reinsurance) pool and the insurance broker…”
Add: “An insurance broker shall be engaged to manage the activity of an insurance (reinsurance) pool on the basis of a tender held in the manner established by a regulatory legal act of the authorised body. For an insurance pool through which all contracts in a compulsory class of insurance are concluded, holding a tender is mandatory.”
Article 13 — new paragraph 10
Add: “The term of an insurance broker’s management of the activity of an insurance (reinsurance) pool shall be five years. On expiry of the term, a new tender shall be held. Early termination of management is permitted where the insurance broker breaches the legislation of the Republic of Kazakhstan or the quality indicators set by the joint activity agreement, with the contracts, information and pending matters being handed over to the insurance broker engaged on the basis of the new tender.”
Subparagraph 26) of Article 43
Add: “…including requirements for an insurance broker engaged to manage the activity of an insurance (reinsurance) pool, the tender procedure, criteria for evaluating applications, management quality indicators and the handover procedure.”
Article 17 — new paragraph 7-2
Add: “An insurance broker managing the activity of an insurance (reinsurance) pool shall publish an annual report on the pool’s activity: the number of contracts concluded, insurance premiums, insurance payouts, claims settlement times and the amount of remuneration received.”
Conclusion
The law allows an insurance broker to be engaged to manage a pool but does not say on what basis, for what term or what requirements the broker must meet. For single pools in compulsory classes of insurance, this means an exclusive position for one broker without open selection. The Association proposes rules: grounds and requirements for the broker, a mandatory open tender for single pools, a five-year management term followed by a new tender, quality indicators, and a procedure for early termination and handover. Such rules give all brokers equal access, protect the manager’s investment and make the pool’s work transparent for policyholders and the regulator.
Legal framework: Law of the Republic of Kazakhstan No. 126-II “On Insurance Activity” of 18 December 2000 — subparagraph 18-3) of Article 3, Article 13, Article 17(1), (3) and (7-1), subparagraph 26) of Article 43. Law as amended on 15 November 2026.
