Insurance Amendment (No. 3) Act 2015
FA E R
N
AT F
TQUO U
BERMUDA
INSURANCE AMENDMENT (NO. 3) ACT 2015
2015 : 50
TABLE OF CONTENTS
Citation
Amends section 1
Amends section 4F
Amends section 6A
Amends section 8B
Amends section 14
Amends section 16A
Amends section 17A
Amends section 26
Amends section 27
Amends section 27G
Amends section 32
Amends section 41
Amends section 53
Consequential amendments
Commencement
SCHEDULE 1
Consequential Amendments - Insurance Accounts Regulations 1980
SCHEDULE 2
Consequential Amendments - Insurance Returns and Solvency Regulations 1980
WHEREAS it is expedient to amend the Insurance Act 1978 and to make
consequential amendments;
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INSURANCE AMENDMENT (NO. 3) ACT 2015
Be it enacted by The Queen’s Most Excellent Majesty, by and with the advice and
consent of the Senate and the House of Assembly of Bermuda, and by the authority of the
same, as follows:
Citation
This Act, which amends the Insurance Act 1978 (the “principal Act”), may be cited
as the Insurance Amendment (No. 3) Act 2015.
Amends section 1
Section 1(1) of the principal Act is amended—
in the definition of—
“excepted long-term business” in subparagraph (b) by inserting after
“1980” the words “and in accordance with the requirements of any
insurance accounts rules”;
“minimum liquidity ratio” by inserting after “1980” the words “and in
accordance with the requirements of any insurance accounts rules”;
“prescribed” by inserting after “regulations” the words “or rules made
by the Authority in accordance with section 6A and section 27F of the
Act”;
“total statutory capital” by inserting after “1980” the words “and in
accordance with the requirements of any insurance accounts rules”;
“total statutory capital and surplus” by inserting after “1980” the words
“and in accordance with the requirements of any insurance accounts
rules”;
by repealing the definition of “solvency margin” and substituting the
following—
“ “solvency margin” means—
in relation to an insurer carrying on general business, the margin
prescribed by regulation 11 of the Insurance Returns and Solvency
Regulations 1980 and the requirements under any insurance
accounts rules;
in relation to an insurer carrying on long-term business, the
margin prescribed by regulation 13 of the Insurance Returns and
Solvency Regulations 1980 and the requirements under any
insurance accounts rules;”;
(a)
(b)
by inserting the following definitions in their proper alphabetical order—
“ “capital redemption contract” means a contract (which by its terms is
expressed to be a capital redemption contract or a funding agreement)
under which an insurer may—
1
2
(a)
(i)
(ii)
(iii)
(iv)
(v)
(b)
(c)
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INSURANCE AMENDMENT (NO. 3) ACT 2015
receive and accumulate sums of money; and
pay a sum or sums of money or render money’s worth,
on dates and in amounts that are not based on life contingencies of
any person;
“insurance accounts rules” means prudential standard rules made by the
Authority in accordance with section 6A(1)(f) of the Act;”;
(a)
(b)
by inserting the following after subsection (5)—
For the purposes of this Act, a capital redemption contract or a funding
agreement shall be deemed to be long-term business.”.
“(6)
Amends section 4F
Section 4F(1) of the principal Act is amended by repealing and substituting the
following definitions—
“ “loss and loss expense provisions” means amounts calculated in relation
to a body corporate by the application of the principles set out in—
the Insurance Accounts Regulations 1980 in relation to Class 1,
Class 2, Class 3, Class A, Class B insurers and Special Purpose
Insurers for the calculation of those amounts in relation to the
insurer; and
any insurance accounts rules in relation to Class 3A, Class 3B,
Class 4, Class C, Class D and Class E insurers for the calculation
of those amounts in relation to the insurer;
“net premiums written” means amounts calculated in relation to a body
corporate by the application of the principles set out in—
the Insurance Accounts Regulations 1980 in relation to Class 1,
Class 2, Class 3, Class A, Class B insurers and Special Purpose
Insurers for the calculation of those amounts in relation to the
insurer;
any insurance accounts rules in relation to Class 3A, Class 3B,
Class 4, Class C, Class D and Class E insurers for the calculation
of those amounts in relation to the insurer;”.
(a)
(b)
(a)
(b)
Amends section 6A
Section 6A(1) of the principal Act is amended—
in paragraph (d) by deleting “and”;
in paragraph (e) by deleting the comma and substituting “; and”;
by inserting the following after paragraph (e)—
(d)
3
4
(a)
(b)
(c)
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INSURANCE AMENDMENT (NO. 3) ACT 2015
statutory financial returns,”.“(f)
Amends section 8B
Section 8B of the principal Act is amended—
in subsection (1)—
by deleting “, Class 3, Class 3A, Class 3B and Class 4” and substituting
“and Class 3”;
by deleting “or insurance technical provisions”;
by inserting the following after subsection (1)—
Every Class 3A insurer shall appoint an individual approved by the
Authority under subsection (3) who is qualified as a loss reserve specialist, to
provide an opinion in accordance with the requirements of Schedule XIV “Statutory
Economic Balance Sheet” of the Insurance (Prudential Standards) (Class 3A
Solvency Requirement) Rules 2011.
Every Class 3B and Class 4 insurer shall appoint an individual
approved by the Authority under subsection (3) who is qualified as a loss reserve
specialist, to provide an opinion in accordance with the requirements of Schedule
XIV “Statutory Economic Balance Sheet” of the Insurance (Prudential Standards)
(Class 4 and Class 3B Solvency Requirement) Rules 2008.”.
“(1A)
(1B)
Amends section 14
Section 14(1) of the principal Act is amended—
in paragraph (ab)(ii) by inserting after “1980” the words “for Class 1, Class
2, Class 3, Class A and Class B insurers and Special Purpose Insurers, and
the requirements applicable under any insurance accounts rules for Class
3A, Class 3B, Class 4, Class C, Class D and Class E insurers”;
in paragraph (ab)(iii) by inserting after “1980” the words “for Class 1, Class
2, Class 3, Class A and Class B insurers and Special Purpose Insurers, and
the requirements applicable under any insurance accounts rules for Class
3A, Class 3B, Class 4, Class C, Class D and Class E insurers”.
Amends section 16A
Section 16A of the principal Act is amended—
in subsection (1)(d) by inserting after “statutory financial statements” the
words “and additional GAAP financial statements”;
by repealing subsection (1A) and substituting the following—
For the purposes of subsection (1)(e), material significance for the
discharge of the Authority’s functions shall include, but is not limited to, the
following—
“(1A)
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(a)
(i)
(ii)
(b)
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(a)
(b)
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(a)
(b)
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INSURANCE AMENDMENT (NO. 3) ACT 2015
identification of a material misstatement in the insurer’s statutory
financial statements or additional GAAP financial statements
resulting from fraud, error or illegal acts or the consequences of
them;
conclusion that there is substantial doubt as to the ability of the
insurer to continue as a going concern for a period of one year from
the balance sheet date;
identification of adjustments to additional GAAP financial
statements which individually or in aggregate, indicates to him
that the previous year’s audited annual financial statements,
prepared according to GAAP, were materially misstated;
identification of adjustments to the insurer’s statutory financial
statements or additional GAAP financial statements which
individually or in aggregate, indicates to him that the previous
year’s audited annual financial statements, were materially
misstated;
identification of a material weakness in internal control or material
conflicts of interest during the conduct of normal audit
procedures; or
unresolved disagreements with management pertaining to the
application of GAAP or statutory reporting.”.
(a)
(b)
(c)
(d)
(e)
(f)
Amends section 17A
Section 17A of the principal Act is amended by inserting the following after
subsection (2)—
Notwithstanding subsection (1), a Class 3A, Class C or Class D insurer
may, where appropriate, submit condensed general purpose financial statements
prepared in accordance with any insurance accounts rules instead of additional
GAAP financial statements.
Subsections (3), (4) and (5) (as respects the appointment and approval
of auditors and the filing of audited financial statements) shall apply mutatis
mutandis in relation to condensed general purpose financial statements submitted
by a Class 3A, Class C or Class D insurer in accordance with subsection (2A).”.
“(2A)
(2B)
Amends section 26
Section 26 of the principal Act is amended—
in subsection (1) by deleting the words “Class A, Class B, Class C, Class D
and Class E” and substituting “Class A and Class B”;
by inserting the following after subsection (1)—
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(a)
(b)
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INSURANCE AMENDMENT (NO. 3) ACT 2015
Every Class C, Class D and Class E insurer shall appoint an individual
approved by the Authority under subsection (3) who is qualified as an approved
actuary to provide an opinion in accordance with the requirements of Schedule XIV
“Statutory Economic Balance Sheet” of the Insurance (Prudential Standards) (Class
C, Class D and Class E Solvency Requirement) Rules 2011.”.
“(1A)
Amends section 27
Section 27 of the principal Act is amended by inserting the following after
subsection (1)—
Every Class C, Class D and Class E insurer shall include in its
statutory financial return a certificate prepared by an actuary approved by the
Authority under section 26(1A), in the form prescribed under any insurance
accounts rules made by the Authority as to the amount of such insurer’s liabilities
outstanding on account of its long-term business.”.
“(1A)
Amends section 27G
Section 27G(1) of the principal Act is amended by deleting “an actuary approved by
the Authority to provide an opinion as to the adequacy of an” and substituting “an individual
approved by the Authority under subsection (3) who is qualified as a group actuary to
provide an opinion on the”.
Amends section 32
Section 32(4) of the principal Act is amended—
in paragraph (b) by deleting “an insurer” and substituting “a Class 1, Class
2, Class 3, Class A, Class B insurer or Special Purpose Insurer”;
by inserting the following after paragraph (b)—
an event specified under any insurance accounts rules occurs in
relation to the audit of a Class 3A, Class 3B, Class 4, Class C, Class
D or Class E insurer and the approved auditor qualifies his report
accordingly, expresses an adverse opinion or denies an opinion in
accordance with such rules;”;
“(ba)
in paragraph (d) by deleting “or regulations” and substituting “, regulations
or any insurance accounts rules”.
Amends section 41
Section 41(1)(b)(v) of the principal Act is amended by deleting “or the regulations”
and substituting “, the regulations or any insurance accounts rules”.
Amends section 53
Section 53(1)(i) of the principal Act is amended by inserting after “prescribed” the
words “or that is not otherwise prescribed in the rules for prudential standards made by
the Authority in accordance with section 6A”.
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(a)
(b)
(c)
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INSURANCE AMENDMENT (NO. 3) ACT 2015
Consequential amendments
Schedule 1, which amends the Insurance Accounts Regulations 1980 (the
“principal Regulations”), has effect.
Schedule 2, which amends the Insurance Returns and Solvency Regulations
1980 (the “principal Regulations”), has effect.
Commencement
This Act comes into operation on 1 January 2016 and applies to all financial years
commencing on or after 1 January 2016.
15 (1)
(2)
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INSURANCE AMENDMENT (NO. 3) ACT 2015
SCHEDULE 1
(section 15)
CONSEQUENTIAL AMENDMENTS - INSURANCE ACCOUNTS REGULATIONS 1980
Amends regulation 3
Regulation 3 of the principal Regulations is amended—
in paragraph (1) by deleting “other regulations.” and substituting “other
rules”;
in paragraph (3) by deleting “insurer” and substituting “Class 1, Class 2,
Class 3, Class A and Class B insurer”.
Amends regulation 4
Regulation 4 of the principal Regulations is amended—
in paragraph (1) by deleting “1 and 2” and substituting “1A and 2A”;
by revoking paragraph (1A);
in paragraph (2) by deleting “an insurer” and substituting “a Class 1, Class
2, Class 3, Class A or Class B insurer”;
in paragraph (3)—
in the introductory paragraph by deleting “An insurer” and substituting
“A Class 1, Class 2, Class 3, Class A or Class B insurer”;
in sub-paragraph (a) by deleting “Form 1 or, as the case may be,”;
in sub-paragraph (b) by deleting “Form 2 or, as the case may be,”.
Amends regulation 5
Regulation 5 of the principal Regulations is amended by deleting “an insurer” and
substituting “a Class A or Class B insurer”.
Amends regulation 8
Regulation 8 of the principal Regulations is amended—
in paragraph (1) by deleting “Every insurer” and substituting “Every Class
1, Class 2, Class 3, Class A and Class B insurer”;
by revoking paragraph (2);
in paragraph (3) by deleting “Class 3A, Class 3B, Class 4, Class A, Class
B, Class C, Class D and Class E” and substituting “Class 1, Class 2, Class
3, Class A and Class B”.
Amends regulation 9
Regulation 9 of the principal Regulations is amended—
1
(a)
(b)
2
(a)
(b)
(c)
(d)
(i)
(ii)
(iii)
3
4
(a)
(b)
(c)
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INSURANCE AMENDMENT (NO. 3) ACT 2015
in paragraph (1) by deleting “Every insurer” and substituting “Every Class
1, Class 2, Class 3, Class A and Class B insurer”;
in paragraph (2)—
by revoking sub-paragraph (a);
by revoking sub-paragraph (b);
in sub-paragraph (e) by deleting “Class 3A, Class 3B, Class 4, Class A,
Class B, Class C, Class D and Class E” and substituting “Class 1, Class
2, Class 3, Class A and Class B”;
in paragraph (3)—
by revoking sub-paragraph (a);
by revoking sub-paragraph (b);
in sub-paragraph (e) by deleting “Class 3A, Class 3B, Class 4, Class A,
Class B, Class C, Class D and Class E” and substituting “Class 1, Class
2, Class 3, Class A and Class B”.
Amends Schedule I
Schedule 1 to the principal Regulations is amended—
by revoking Form 1;
by revoking Form 2;
in Form 1A in the heading by deleting “Class 3A, Class 3B or Class 4” and
substituting “Class 1, Class 2 or Class 3”;
in Form 2A in the heading by deleting “Class 3A, Class 3B or Class 4” and
substituting “Class 1, Class 2 or Class 3”;
in Form 5 at line 34 in the heading by deleting “(INCREASE) DECREASE
IN POLICY RESERVES (Actuarial Liabilities):” and substituting “General
Business - Class 1, Class 2 or Class 3 Insurer:”;
in Form 7 at line 4 by deleting “(INCREASE) DECREASE” and substituting
“(DECREASE) INCREASE”.
Amends Schedule II
Schedule II to the principal Regulations is amended—
by revoking Part I;
by revoking Part II;
by deleting the title to Part V and substituting the following—
“PART V
(Reg 8(2))
(a)
(b)
(i)
(ii)
(iii)
(c)
(i)
(ii)
(iii)
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(a)
(b)
(c)
(d)
(e)
(f)
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(a)
(b)
(c)
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INSURANCE AMENDMENT (NO. 3) ACT 2015
Matters to be set forth in Notes to the Statutory Statement of Income - Class
1, Class 2, Class 3, Class A, Class B, section 24(6) composite and Special
Purpose Insurer”;
by deleting the title to Part VI and substituting the following—
“PART VI
(Reg 8(2))
Matters to be set forth in Notes to the Statutory Statement of Income - Class
1, Class 2, Class 3, Class A, Class B, section 24(6) composite and Special
Purpose Insurer”.
Amends Schedule III
Schedule III to the principal Regulations is amended—
by revoking Part I;
by revoking Part II;
by deleting the title to Part IV and substituting the following—
“PART IV
(Reg 9(2))
INSTRUCTIONS AFFECTING THE STATUTORY BALANCE SHEET
Class 1, Class 2, Class 3, Class A, Class B, section 24(6) composite and Special
Purpose Insurer”.
Amends Schedule IV
Schedule IV to the principal Regulations is amended—
by revoking Part I;
by revoking Part II;
by deleting the title to Part IV and substituting the following—
“PART IV
(Reg 9(3))
INSTRUCTIONS AFFECTING THE STATUTORY BALANCE SHEET
Class 1, Class 2, Class 3, Class A, Class B, section 24(6) composite and Special
Purpose Insurer”.
(d)
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(a)
(b)
(c)
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(a)
(b)
(c)
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INSURANCE AMENDMENT (NO. 3) ACT 2015
SCHEDULE 2
(section 15)
CONSEQUENTIAL AMENDMENTS - INSURANCE RETURNS AND SOLVENCY
REGULATIONS 1980
Amends regulation 2
Regulation 2 of the principal Regulations is amended by inserting the following in
its proper alphabetical order—
“insurer” means a Class A, Class B, Class 1, Class 2, Class 3 insurer or Special
Purpose Insurer, except where the context otherwise requires;”.
Amends regulation 5
Regulation 5(1) of the principal Regulations is amended—
by revoking sub-paragraph (a)(iii);
by revoking sub-paragraph (d);
in sub-paragraph (e) by deleting the full-stop and substituting “; and”;
by inserting the following after sub-paragraph (e)—
annual statutory declaration;
statement of changes of control;
own risk statement;
underwriting analysis; and
schedule of segregated accounts.”.
“(f)
(g)
(h)
(i)
(j)
Revokes and substitutes regulation 6
Regulation 6 of the principal Regulations is revoked and substituted with the
following—
“Cover sheet
The cover sheet shall—
bear the name of the insurer and the title “Statutory Financial
Return”;
state the certificate of registration number;
state the class or classes of registration;
state the period covered by the return;
state the currency in which amounts are shown in the insurer’s
statutory financial statements and whether that currency is the
6
(a)
(b)
(c)
(d)
(e)
1
2
(a)
(b)
(c)
(d)
3
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INSURANCE AMENDMENT (NO. 3) ACT 2015
currency in which those amounts are required by regulation 10(2)
of the Insurance Accounts Regulations 1980 to be shown;
state the name of the insurer’s ultimate parent;
state the name of the insurer’s parent company;
state the industry sector of the insurer’s parent;
state the insurer’s ownership structure (for example, mutual
company, company limited by shares, limited partnership, permit
company, branch insurer, trust company, owned by a government
or a government agency);
state the insurer’s company structure;
state the nature of the insurance business carried on by the
insurer, including but not limited to—
whether the insurer is a member of an insurance group;
whether the insurer has segregated accounts;
whether the insurer is in run-off;
state the conditions, if any, which have been imposed on the
insurer’s registration under section 4 of the Act;
state the particulars, if any, of any direction issued by the
Authority;
state the classes of business written and separated by Class of
Business type, Gross Premium Written, Premium Ceded, Net
Premium Written, Net Earned Premium, Net Known Loss and Loss
Expense Provision, and Net Loss Incurred but Not Reported;
state any non-Bermuda branches or subsidiaries within the
insurance group (if applicable);
state the names of all of the insurer’s directors, the effective date
of appointment of each director, the effective date any director
ceased to act, and the title and position held by any director (if
applicable); and
state the names of all of the insurer’s officers, the effective start
date of employment of all officers, the date any officer ceased to
act, and the title and position held by any officer.”.
(f)
(g)
(h)
(i)
(j)
(k)
(i)
(ii)
(iii)
(l)
(m)
(n)
(o)
(p)
(q)
Amends regulation 7
Regulation 7 of the principal Regulations is amended—
in paragraph (1)—
in sub-paragraph (c)(ii) by deleting the semicolon and substituting a
full-stop;
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(a)
(i)
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INSURANCE AMENDMENT (NO. 3) ACT 2015
by revoking sub-paragraph (d);
in paragraph (3)(c) by deleting the words “or the declaration of the statutory
ratios”.
Amends regulation 8
Regulation 8(2)(f) of the principal Regulations is revoked.
Amends regulation 8A
Regulation 8A(2) of the principal Regulations is amended by deleting the words
“Part II” and substituting “Part IV”.
Amends regulation 10
Regulation 10 of the principal Regulations is amended—
in paragraph (1) by deleting “figure B, figure C and figure D,” and
substituting “and figure B,”;
by revoking paragraph (1A).
Amends regulation 12
Regulation 12(1A) of the principal Regulations is revoked.
Revokes regulations 13
Regulation 13 of the principal Regulations is revoked.
Revokes regulations 14A
Regulation 14A of the principal Regulations is revoked.
Inserts regulations 14B to 14F
The principal Regulations are amended by inserting the following after regulation
14A—
“Annual statutory declaration
An annual statutory declaration shall be signed by at least two directors of
the insurer and by the insurer’s principal representative in Bermuda, and shall
state whether—
the information in the latest statutory financial return, including
any supporting schedules and attachments, fairly represents the
financial condition and position of the insurer in all material
respects and are in compliance with the Act, any applicable
regulations, the Insurance Code of Conduct and any direction,
condition or restriction imposed on the insurer by the Authority;
the insurer has sufficient resources as at the date of the latest
statutory balance sheet to enable the insurer to continue as a
14B
(a)
(b)
(ii)
(b)
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(a)
(b)
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INSURANCE AMENDMENT (NO. 3) ACT 2015
going concern, and to satisfy its obligations as and when they fall
due for a period of twelve months post the relevant balance sheet
date.
Statement of changes of control
An insurer shall provide a statement of changes of control relating to the
relevant year which shall—
confirm any change of an insurer’s shareholder controllers since
the last statutory financial return;
state the year-end date;
attach a register of shareholder controllers of the insurer,
confirming the following—
any increase or decrease in the number of shareholder
controllers;
changes to the position that a shareholder controller is
appointed to or holds an office in;
changes in the ownership percentage of a shareholder
controller (whether increase or decrease);
the date a person became a new shareholder controller;
the date a person ceased to be a shareholder controller;
state the name of the ultimate parent company;
state the industry of operation of the ultimate parent company;
state the jurisdiction and name of the direct parent company;
state the jurisdiction of the ultimate parent company;
state whether or not there has been any change of directors since
the filing of the last statutory financial return; if yes, provide—
the number of new directors;
the first and last name of each new director and his title;
the date of birth of each director;
the date a director was appointed;
the date a director ceased to act;
state whether or not a registered insurance manager has been
appointed to manage the insurer’s affairs; if no such manager has
been appointed, state—
the number of officers of the insurer;
14C
(a)
(b)
(c)
(i)
(ii)
(iii)
(iv)
(v)
(d)
(e)
(f)
(g)
(h)
(i)
(ii)
(iii)
(iv)
(v)
(i)
(i)
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INSURANCE AMENDMENT (NO. 3) ACT 2015
the title and first and last name of each officer;
the date of birth of each officer;
state whether or not there has been any change of officers since
the filing of the last statutory financial return; if yes, provide—
the number of new officers;
the title and first and last name of each new officer;
the date of birth of each officer;
the date an officer was appointed;
the date an officer ceased to act.
Own risk assessment
An insurer’s own risk assessment shall provide—
an overview of the insurance programme (including but not limited
to affiliated, third party, source of business, and details of policy
limits or aggregate limits);
details of any significant changes planned for the next 12 months;
confirmation of fronting insurer or insurers, if applicable;
details of any investment in, and advances to, affiliates (over 10%
of the amount stated on line 4 of the statutory balance sheet) by
including—
name of affiliate;
nature of balance;
inter-company balances and obligations;
details of any reinsurance by including—
name of reinsurer or reinsurers;
premiums ceded;
paid loss recoverable;
reinsurance recoverable on loss expense provisions or
insurance reserves;
details of any collateral including but not limited to—
collateral posted to contracts written to policy limits;
collateral (for example, funds withheld or letters of credit);
form of collateral;
amount of collateral provided;
(ii)
(iii)
(j)
(i)
(ii)
(iii)
(iv)
(v)
14D
(a)
(b)
(c)
(d)
(i)
(ii)
(iii)
(e)
(i)
(ii)
(iii)
(iv)
(f)
(i)
(ii)
(iii)
(iv)
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INSURANCE AMENDMENT (NO. 3) ACT 2015
amount of assets encumbered;
details of the number of employees of the insurer residing in
Bermuda;
details of the discount on loss reserves by—
line of business;
discount rate or range of rates;
amount of discount on loss reserves;
details of investments based on own risk assessment (“ORA”) rate
of—
ORA Rating
Category
S&P Moody’s AM Best Fitch
1 ORA Rating 1 AAA Aaa A++ AAA
2 ORA Rating 2 AA+ to AA- Aa1 to Aa3 A+ AA+ to AA-
3 ORA Rating 3 A+ to A- A1 to A3 A A+ to A-
4 ORA Rating 4 BBB+ to BBB- Baa1 to Baa3 A- BBB+ to BBB-
5 ORA Rating 5 BB+ to BB- Ba1 to Ba3 B++ to B BB+ to BB-
6 ORA Rating 6 B+ to B- B1 to B3 B- to C+ B+ to B-
7 ORA Rating 7 CCC+ to CCC- Caa1 to Caa3 C to C- CCC+ to CCC-
8 ORA Rating 8 Below CCC- Below Caa3 Below C- Below CCC-
details of known or notified legal actions, disputes or arbitration;
risk register;
risk appetite;
investment guidelines.
Underwriting analysis
An insurer shall provide details of its underwriting analysis as follows—
the statutory lines of general business written, as set out in Table
A, by—
gross premium written;
net premium written;
related gross premiums written;
unrelated gross premiums written;
connected gross premiums written;
insurance premiums written;
(v)
(g)
(h)
(i)
(ii)
(iii)
(i)
(j)
(k)
(l)
(m)
14E
(a)
(i)
(ii)
(iii)
(iv)
(v)
(vi)
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INSURANCE AMENDMENT (NO. 3) ACT 2015
reinsurance premiums written;
Table A
1 Accident and Health, Travel, Personal Accident
2 Agriculture
3 Aviation - Hull, Liability and War
4 Construction
5 Credit/Surety
6 Crime and Fidelity
7 Cyber Risk
8 Energy - Onshore and Offshore
9 Environmental Risk
10 General liability - Public, Products, Umbrella, Product recall
11 Marine - P&I, Cargo, Hull and Liability, War
12 Medical Malpractice
13 Mortgage
14 Motor - APD and Liability
15 Political Risks
16 Professional Liability - Professional Indemnity, D&O, Bankers Blanket,
E&O
17 Property and Casualty Catastrophe
18 Property Damage and Business Interruption
19 Property Retrocession
20 Finite Reinsurance
21 Terrorism
22 Warranty, Residual Value
23 Workers Compensation/Employers Liability
24 Incidental long-term business (not to be included if a composite licence)
details of the geographical location of the general business gross
premiums written;
details of the statutory lines of long-term business written, as set
out in Table B, by—
gross premium written;
net premium written;
related gross premiums written;
unrelated gross premiums written;
(vii)
(b)
(c)
(i)
(ii)
(iii)
(iv)
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INSURANCE AMENDMENT (NO. 3) ACT 2015
connected gross premiums written;
insurance premiums written;
reinsurance premiums written;
Table B
1 Mortality
2 Critical Illness
3 Longevity
4 Deferred Annuities
5 Disability Income: Active lives with premium guarantee of—
(a) Less than or equal to 1 year
(b) More than 1 year but less than 5 years
(c) Greater than 5 years
6 Disability Income: Active lives for other accident and sickness
7 Disability Income: Claims in payment
8 Disability Income: Claims in payment for other accident and sickness
9 Group Life
10 Group Disability
11 Group Health
12 Stop Loss
13 Rider
14 Variable Annuities
details of geographical location of the long-term business gross
premiums written.
Schedule of segregated accounts
An insurer shall provide the following information for each segregated cell
by statutory lines of business written under the schedule of segregated accounts—
the cell reference number;
the name;
total assets;
total liabilities;
statutory capital and surplus;
cash and investments;
net loss reserves;
(v)
(vi)
(vii)
(d)
14F
(a)
(b)
(c)
(d)
(e)
(f)
(g)
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INSURANCE AMENDMENT (NO. 3) ACT 2015
reinsurance recoverables;
statutory lines of business written as set out in Tables A and B;
gross premiums written;
net premiums written;
currency used;
confirm whether the insurance business written by a segregated
account cell is business that meets the definition in the Act of
business that can ordinarily be written by a Class 1, Class 2, Class
3, Class A or Class B insurance business (with the exception that
the insurance business written is that which is assumed from an
affiliate insurer is deemed by the Authority as “connected
business” or is business written by an insurer owned by insurance
brokers or agents);
whether or not there is any inter-relationship between segregated
cells (including but not limited to contractual arrangements,
reinsurance, guarantees, transfers or loans);
whether or not there is access to the general account assets;
the remedial actions or update on proceedings when a segregated
cell is in deficit, is insolvent, or is subject to litigation.”.
(h)
(i)
(j)
(k)
(l)
(m)
(n)
(o)
(p)
Revokes and substitutes Schedule I
Schedule I to the principal Regulations is revoked and substituted with the
following—
“SCHEDULE I
(Reg. 10(1))
GENERAL BUSINESS SOLVENCY MARGIN
Figure A
For the purposes of regulation 10, figure A has the following value in
relation to the class of insurer indicated—
Class 1 $120,000
Class 2 $250,000
Class 3 $1,000,000
Figure B
For the purposes of regulation 10, paragraphs (2) and (3) set out the
method of calculating figure B in relation to Class 1, Class 2 and Class 3 insurers.
Where the net premiums—
1
2 (1)
(2)
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INSURANCE AMENDMENT (NO. 3) ACT 2015
written by a Class 1, Class 2 or Class 3 insurer in its current
financial year; or
projected to be written by an insurer on application for registration
as a Class 1, Class 2 or Class 3 insurer, in its first financial year,
do not or (as the case may be) are not projected to exceed
$6,000,000,
figure B shall be calculated as 20% of those net premiums.
Where the net premiums—
written by a Class 1, Class 2 or Class 3 insurer in its current
financial year; or
projected to be written by an insurer, on application for
registration as a Class 1, Class 2 or Class 3 insurer, do not or (as
the case may be) are not projected to, exceed $6,000,000,
figure B shall be calculated as $1,200,000 plus the following percentage of the net
premiums written which exceed $6,000,000 in relation to the class of insurer
indicated—
Class 1 10%
Class 2 10%
Class 3 15%.
In this paragraph, “net premiums written” in relation to any financial
year means, in relation to a Class 1, Class 2 or Class 3 insurer, the net amount,
after deductions of any premiums ceded by the insurer for reinsurance, of the
premiums written by the insurer in that year in respect of general business and
“net premiums projected to be written” has a corresponding meaning.
Figure C
For the purposes of regulation 10, figure C shall be calculated as the
following percentage of the aggregate—
of the amounts shown by the insurer in completing lines 17 and
18 of Form 1 or Form 1A (as applicable) in the Insurance Accounts
Regulations 1980; or
of those amounts as projected by the insurer on application for
registration, in relation to the class of insurer indicated—
Class 1 10%
Class 2 10%
Class 3 15% ”.
(a)
(b)
(3)
(a)
(b)
(4)
3
(a)
(b)
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INSURANCE AMENDMENT (NO. 3) ACT 2015
Revokes and substitutes Schedule II
Schedule II to the principal Regulations is revoked and substituted with the
following—
“SCHEDULE II
(Reg. 12(1))
MINIMUM MARGIN OF SOLVENCY FOR LONG-TERM BUSINESS
Class Minimum Margin of Solvency (‘MMS’)
A greater of $120,000 or 0.5% of assets;
B greater of $250,000 or 1% of assets,
where assets shall be the total assets reported on an insurer’s
balance sheet in the relevant year less the amount held in a
segregated account. ”.
[Assent Date: 23 December 2015]
[Operative Date: 01 January 2016]
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