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Financial Services Supervision Law (Insurance), 5741-1981

חוק הפיקוח על שירותים פיננסיים (ביטוח), תשמ"א-1981

Published: 1981-04-23Consolidated Hebrew text as of 2026-07-26 · Last amended 2026-07-22✓ Amendment status checked against the Knesset legislation record on 2026-09-29
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Unofficial English translation — for reference only. It may contain errors or omissions and cannot be relied on as a legal text. Only the Hebrew text published in Reshumot is legally binding.More

This English text was translated from the official Hebrew using a range of translation tools, and it undergoes ongoing checks and updates. It is not a certified translation.

Despite these checks, it may contain errors, omissions, or imprecise renderings of legal terminology and cross-references, and it may not yet reflect the latest amendments. It cannot be relied upon as a legal text.

The Hebrew text as published in Reshumot (ספר החוקים) and on the Knesset website is the sole authoritative and legally binding version. In any discrepancy, the Hebrew text prevails.

This translation is provided for informational purposes only and does not constitute legal advice. For use in legal proceedings, request a certified Expert Legal Opinion.

Chapter X: Miscellaneous Provisions and Penalties

93.§

(Repealed — תשס״ה־4)

94.§

(Repealed — תשס״ה־4)

Health Fund§

95.

The provisions of this Law shall not apply to a health fund as defined in the National Health Insurance Law, 5754-1994, in respect of medical services it provides under that Law, including additional services pursuant to section 10 of that Law.

Application of Provisions§

96.
(a)A person who engages in Israel in brokerage in relation to insurance between any person and a foreign resident or the foreign resident's agent, a person who engages in Israel in brokerage in relation to insurance between any person and a person who has received an exemption under section 86 or that person's agent, and an authorised representative of a person who has received an exemption under section 86 – their status shall be as that of an insurance agent, and the provisions of this Law relating to an agent shall apply to them, including the licensing obligation.
(b)The Minister of Finance may direct that a person to whom subsection (a) applies shall also be subject to the provisions of Sections A to D of Chapter III, Section B of Chapter IV, Chapter VIII, and sections 38 to 41, 55 to 62 and 98, all or some of them, as though that person were an insurer.

Audit Expenses§

97.

Where the Commissioner has authorised a person who is not a State employee to conduct an audit at an insurer or insurance agent, the Commissioner may impose the costs of the audit on the insurer or on the insurance agent, as the case may be.

Fees§

98.

The Minister of Finance may make Regulations regarding –

(1)a fee for the grant of a licence to an insurer;
(2)an annual fee for an insurer for each branch of insurance in which the insurer was licensed to engage in that year;
(3)a fee for the grant of a licence to an individual agent and to a corporate agent;
(4)an annual fee for an individual agent and for a corporate agent;
(5)a fee for an examination;
(6)methods of payment of fees and payment dates;
(7)interest and linkage differentials payable on a fee not paid on time.

Registration of an Insurer and Corporate Agent§

99.

A corporation whose incorporation documents submitted for registration show that among its objects is engaging in insurance or in insurance brokerage shall not be registered unless a certificate of the Commissioner confirming the Commissioner's consent to the registration has been attached.

Restriction on Use of the Word "Insurance"§

100.
(a)No person, other than a holder of a licence under this Law, shall use the word "insurance" or any word derived from it in the name under which that person conducts business, except with a permit from the Commissioner.
(b)The Commissioner may direct any person, after consultation with the Committee and after that person has been given an opportunity to submit or present arguments before the Committee, to delete, within the period set by the Commissioner, the word "insurance" or any word derived from it from the name under which that person conducts business.

Conditions in Licences and Prohibition of Transfer§

101.
(a)A person authorised to grant a licence, permit or approval under this Law may attach conditions to it and restrict it.
(b)A licence, permit or approval granted under this Law is not transferable.

Appeal§

102.
(a)An insurer or insurance agent who considers himself aggrieved by a decision of the Commissioner under section 62(a) may appeal to the District Court within 45 days of receipt of the notice of the decision under the said sections; the appeal shall be heard by a single judge.
(b)The filing of an appeal shall not stay the execution of a decision that is the subject of the appeal, unless the Commissioner has agreed thereto or the court has ordered a stay of execution of the decision.
(c)The Minister of Justice may make procedure Regulations for the hearing of an appeal.

Extension of Time Limits§

103.

The Commissioner may extend, for a category of cases or for a particular case, any time limit prescribed in this Law or in Regulations made thereunder, except for a time limit prescribed in sections 29(c), 81 or 102 or in Regulations under section 102.

Penalties§

104.
(a)In this section, "the basic fine" – an amount as set out below, as the case may be:
(1)in respect of an individual agent and in respect of an employee in a corporation referred to in paragraphs (3) or (4) who is not an office holder therein – the amount prescribed in section 61(a)(4) of the Penal Law;
(2)in respect of an individual not referred to in paragraph (1) – twice the amount prescribed in section 61(a)(4) of the Penal Law;
(3)in respect of a corporate agent and any other corporation that is not an insurer – eight times the amount prescribed in section 61(a)(4) of the Penal Law;
(4)in respect of an insurer – sixteen times the amount prescribed in section 61(a)(4) of the Penal Law.
(b)A person who has done any of the following is liable – to three years' imprisonment or a fine at the rate of one and a half times the basic fine:
(1)engaged in insurance without a licence, or in branches of insurance not specified in the licence, contrary to the provisions of section 14;
(2)acted contrary to a direction given by the Commissioner under the provisions of section 23(b), regarding the conduct of business after cancellation of a licence;
(3)held means of control in an insurer or controlled an insurer, without holding a permit, contrary to the provisions of section 32;
(3a)agreed with another person regarding their voting for the appointment of a director in an insurer, including regarding their voting for the termination of that director's tenure, without holding a permit therefor, contrary to the provisions of section 32(a1);
(4)held a material holding in the long-term savings sector, contrary to the provisions of section 32(c1);
(4a)controlled an insurer that is a significant financial body, or held means of control in such an insurer, contrary to the provisions of section 32a;
(5)transferred means of control in an insurer, knowing that the transferee requires a permit and does not hold one, contrary to the provisions of section 33;
(6)received a benefit in connection with the management of yield-dependent insurance, contrary to the provisions of section 32(d) of the Provident Funds Supervision Law, as applied by section 36a;
(7)(Repealed)
(8)did not return expenses, management fees, commission, consideration or any other benefit, in accordance with the directions of the Commissioner under section 32(f) of the Provident Funds Supervision Law, as applied by section 36a;
(9)(Repealed)
(10)did not publish a correction to a publication containing a misleading description in relation to yield-dependent insurance, in accordance with the direction of the Commissioner under section 36(c) of the Provident Funds Supervision Law, as applied by section 36a;
(11)collected insurance premiums otherwise than in accordance with the directions of the Minister of Finance under section 37;
(12)introduced an insurance plan or a service endorsement, or a modification to an insurance plan or to a service endorsement, without having given the Commissioner notice of the intention to do so, contrary to the provisions of section 40(a) or (h), as the case may be;
(12a)introduced an insurance plan or a service endorsement, or a modification to an insurance plan or to a service endorsement, notwithstanding that the Commissioner or an employee subordinate to the Commissioner notified an objection to the insurance plan or to the service endorsement, in whole or in part, or to the modification to the insurance plan or to the service endorsement, in whole or in part, contrary to the provisions of section 40(b) or (h);
(12b)introduced an insurance plan or a service endorsement, or a modification to an insurance plan or to a service endorsement, without having received prior written approval therefor from the Commissioner, contrary to the provisions made under section 40(c)(4) or (h);
(12c)introduced an insurance plan or a service endorsement, or did not introduce a modification to an insurance plan or to a service endorsement, contrary to a direction of the Commissioner under section 40(d) or (h);
(13)(Repealed)
(14)included a misleading particular in a report or notice, contrary to the provisions of section 42a, or gave consent for a report or document prepared by that person containing a misleading particular to be included in a report or notice as aforesaid;
(15)conducted business in the life insurance branch, contrary to the provisions made under section 54;
(16)gave a misleading description of an insurance transaction or included a misleading description in a publication to the public, contrary to the provisions of section 55;
(17)did anything that constitutes exploitation or exercise of undue influence, in order to enter into an insurance transaction on unreasonable terms or in order to receive consideration exceeding the customary consideration, contrary to the provisions of section 58;
(18)did not remedy a deficiency in accordance with a direction given by the Commissioner, under the provisions of section 62(a);
(19)did not comply with a direction given by the Commissioner to remedy a defect or to prevent harm under the provisions of section 65;
(20)contravened a direction to set aside amounts, given by the Commissioner under the provisions of section 66;
(21)contravened a direction given by the Commissioner under the provisions of sections 67 or 68;
(22)served as an office holder or as another employee in an insurer notwithstanding that the authority of that person was suspended or restricted under the provisions of section 68, or served as an office holder in an insurer notwithstanding that that person was suspended or removed from office under the provisions of that section;
(23)(Repealed)
(c)A person who has done any of the following is liable – to two years' imprisonment or the basic fine:
(1)(Repealed)
(2)engaged in brokerage in relation to insurance, and is not one of those referred to in paragraphs (1) or (2) of section 24(a), or engaged in brokerage in relation to insurance otherwise than in accordance with the conditions set out in those paragraphs;
(3)engaged in brokerage in relation to insurance between a person who is not an insurer and a foreign resident or the foreign resident's agent who do not hold a licence under this Law, contrary to the provisions of section 31(a);
(4)controlled a corporate agent without a permit, contrary to the provisions of section 32(b);
(5)(Repealed)
(6)transferred means of control in a corporate agent, knowing that the transferee requires a permit and does not hold one, contrary to the provisions of section 33;
(7)(Repealed)
(8)(Repealed)
(9)received insurance business, contrary to the provisions of section 41(a);
(10)(Repealed)
(11)(Repealed)
(12)(Repealed)
(13)(Repealed)
(14)(Repealed)
(15)(Repealed)
(16)(Repealed)
(17)made insurance conditional upon another engagement, contrary to the provisions of section 57;
(18)acted in the winding-up of the business of an insurer otherwise than in accordance with the directions given by the Commissioner under sections 63 or 64;
(19)used the word "insurance" or a word derived from it in the name under which that person conducts business, without a permit from the Commissioner, contrary to the provisions of section 100.

Offence with Intent to Deceive or Mislead§

104a.

A person who committed one of the offences listed in section 104 in order to defraud or mislead an insured person, or in order to defraud or mislead a person considering entering into an insurance contract, is liable – to five years' imprisonment or a fine at the rate of three times the fine prescribed for that offence.

Fine for a Continuing Offence§

104b.

In the case of a continuing offence, the court may impose, for each day on which the offence continues, in addition to any other penalty, a fine at the rate of one fiftieth of the fine that the court is authorised to impose for that offence.

Duty of Supervision§

105.
(a)An office holder in a corporation is obligated to supervise and to do everything possible to prevent an offence under section 104 being committed by the corporation or by any of its employees; a person who contravenes this provision is liable – to the fine prescribed for that offence if imposed on an individual.
(b)Where an offence under section 104 has been committed by a corporation or by any of its employees, it shall be presumed that an office holder in the corporation has contravened the duty referred to in subsection (a), unless that office holder has proved that everything possible was done to prevent the offence.
(c)In this section, "office holder" – a director, an active manager of a corporation, a partner, excluding a limited partner, or any other person holding a position who is responsible on behalf of the corporation for the area in which the offence was committed.

Publication of Judgment or Correction of Publication§

106.

A court may, following a conviction or a liability order under this Law, order that a final judgment or a summary thereof, or a correction to a misleading publication, be published to the public in the form and manner it shall determine, and may direct who shall bear the costs of publication; where the court has ordered that the accused shall bear the costs of publication, such costs shall have the same status as a fine imposed by the court.

Evidence of Publication§

107.

Where a copy of a newspaper or other printed matter distributed to the public in which a misleading description has been printed is submitted, it shall serve as prima facie evidence that the publication was indeed made in that newspaper or printed matter.

Compensation§

108.

Damage caused to a person by an offence against the provisions of sections 55 to 59 shall have the same status as damage in respect of which compensation may be claimed under the law of torts.

Giving Notice of Intention to File a Claim against a Third Party§

108a.
(a)In this section, "claim" – a claim for compensation or indemnification, or for subrogation as that term is defined in section 62 of the Insurance Contract Law, 5741-1981, all in connection with insurance benefits paid by an insurer to an insured person.
(b)An insurer shall send a written notice to a third party of its intention to file a claim against that party, at least 30 days before filing the claim.
(c)A notice referred to in subsection (b) shall include the name of the insurer and the means of contacting the insurer, as well as details of the cause of action, and the material documents relating to the claim that the insurer intends to file shall be attached thereto.
(d)
(1)Where an insurer has filed a claim against a third party contrary to the provisions of subsection (b), the court hearing the claim may award costs in favour of the third party in an amount it deems appropriate in the circumstances of the matter, which shall not be less than NIS 1,000 and shall not exceed NIS 5,000, and may also order the striking out of the claim, all unless the insurer has proved that had it sent a notice in accordance with the provisions of that subsection, its claim would have become time-barred;
(2)for the purposes of the provisions of paragraph (1), the burden of proof that the third party received the notice is on the insurer.
(e)The provisions of subsection (b) shall not apply if an additional defendant has been joined to the claim at any stage of the proceedings.

Giving Notice Regarding a Seized Vehicle that was Stolen or Declared a Total Loss§

108b.
(a)Where an insurer becomes aware that an insured vehicle that is a seized vehicle has been stolen or has been declared a total loss and the insured person has a right to insurance benefits, the insurer shall send to the seizing entity a notice of the change in the condition of the vehicle and of the debtor's right to insurance benefits from the insurer, within 100 days of the date on which the insurer became aware of the matter.
(b)In this section –

"seizing entity" – any of the following, as the case may be:

(1)the enforcement and collection system;
(2)the Fines, Fees and Costs Collection Authority;
(3)an entity that imposed a seizure on a vehicle by virtue of the Tax Ordinance (Collection);

"total loss vehicle" – any of the following:

(1)a total loss vehicle as defined in the Law for the Restriction of Use and Registration of Transactions in Used Vehicle Parts (Prevention of Theft), 5758-1998;
(2)a constructive total loss vehicle as defined in the provisions under section 38;

"insured vehicle" – a vehicle insured against property damage and third-party property damage as that term is defined in the provisions under section 38;

"seized vehicle" – a vehicle on which a seizure has been imposed under the Execution Law, 5727-1967, the Fines, Fees and Costs Collection Authority Law, 5755-1995, or the Tax Ordinance (Collection).

Adaptation of Provisions to Cooperative Societies§

109.

Where this Law refers to a board of directors, a director or a business manager, these shall be construed, in respect of an insurer or insurance agent that is a cooperative society, as though they referred to a committee or an officer, as the case may be, as these terms are defined in the Cooperative Societies Ordinance, and where this Law refers to share capital, it shall be construed as though it referred to the total membership contributions in the cooperative society.

Application of Provisions Regarding a Receiver§

110.

The provisions of Chapter V of the Execution Law, 5727-1967, shall apply to a receiver appointed under this Law, with the necessary modifications.

Repeal§

111.

The Insurance Business Supervision Law, 5711-1951 – is hereby repealed.

Publication of the Commissioner's Directives§

111a.
(a)Directives of the Commissioner issued under this Law are not required to be published in Reshumot (Official Gazette); however, the Commissioner shall publish in Reshumot (Official Gazette) a notice of the issuance of directives as aforesaid that are of legislative effect and of the date of their commencement.
(b)Directives of the Commissioner issued under this Law that are of legislative effect and any amendment thereto shall be made available for public inspection at the offices of the Commissioner and shall be published on the website of the Ministry of Finance; and the Minister of Finance may prescribe additional methods for their publication.

Implementation and Regulations§

112.

The Minister of Finance is charged with the implementation of this Law and may make Regulations in all matters relating to its implementation.

Commencement§

113.

This Law shall commence on the 29th day of Sivan 5741 (1 July 1981), except for Chapter VII, which shall commence on the date of publication of this Law in Reshumot (Official Gazette).

Publication§

114.

This Law shall be published within thirty days of the date of its adoption by the Knesset.

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