Tunisia – Money Laundering in capitalization and life insurance
Thursday, 08 17 2017, Category: Insurance and Reinsurance, Country: Tunisia
The Tunisian Financial Analysis Committee (CTAF) revealed that the capitalisation service, one of the savings products and an insurance investment means and the life insurance service, which is based on the mortality risk prediction principle, are considered as a source for money laundering in Tunisia, especially as there are 15 insurance and 5 life insurance companies in the country.
The traditional method used in money laundering for the capitalisation service consists in terminating a contract before the designed period and recovering the value of the assets to buy property assets or other investments far from legal proceedings.
As for the life insurance service, it hinges on paying the capital or regular bonuses to the beneficiary in case of the insured’s death during the contract’s duration, the committee further said in its report entitled National evaluation of money laundering and terrorism financing risks/April 2017.
CTAF experts concluded that the annulment of the life insurance savings contracts contradicts with its goal based on tax advantage, which helps hide the legitimate source of money laundering.
The capitalisation and life insurance services accounted for 18% of the overall insurance market in Tunisia in 2015 and the 8.4% growth recorded in the insurance service in Tunisia in the 2011-2015 period is mainly linked to auto insurance, the report pointed out.
Source: Tunisia News Gazette