7.
—(1) An exempt insurance broker or a registered insurance broker shall pay into a bank account all moneys received by it —
(a)
from or on behalf of an insured or intending insured for or on account of an insurer in connection with a contract of insurance or proposed contract of insurance; or
(b)
from or on behalf of an insurer for or on account of an insured or intending insured.
(2) No exempt insurance broker or registered insurance broker shall withdraw moneys from a bank account without the prior written consent of the Authority.
(3)
Paragraph (2) shall not apply to any withdrawal of moneys from a bank account for —
(a)
any payment to or for a person entitled to receive payment of the moneys, including itself in so far as it is entitled to receive payment for itself;
(b)
any payment to or for an insurer in respect of amounts due to the insurer under or in relation to a contract of insurance;
(d)
any repayment of moneys that were paid into the bank account in error.
(4) An exempt insurance broker or a registered insurance broker shall pay moneys received from the realisation of any investment made under paragraph (3)(c) into a bank account.
(5) If, upon the realisation of any investment made under paragraph (3)(c), the amount of moneys received in respect of the realisation is less than the amount of moneys invested, the exempt insurance broker or the registered insurance broker shall pay into the bank account from which the moneys were withdrawn for investment, an amount equal to the difference between the amount invested and the amount realised.
(6) Subject to
paragraphs (7) to
(10), an exempt insurance broker or a registered insurance broker shall pay into, or retain in, a bank account any interest or other income that is received by it under the bank account or from any deposit made under paragraph (3)(
c).
(7) Subject to
paragraph (8), interest or other income arising from any payment which is due to the insurer under or in relation to a contract of insurance where the cover commences on or after 1st October 2002 that is received by an exempt direct insurance broker or a direct insurance broker from —
(b)
any deposit made under paragraph (3)(c),
shall belong to the insurer, but may be retained by the insurance broker for its own benefit with the insurer’s prior consent, and need not be paid into, or retained in, a bank account.
(8) Interest or other income arising from any payment which is due to an insurer under or in relation to a contract of insurance where the cover commences on or after 1st October 2002 that is received by an exempt direct insurance broker or a direct insurance broker from —
(b)
any deposit made under paragraph (3)(c),
after the credit period shall not be retained by the insurance broker for its own benefit and shall immediately be paid to the insurer to whom such payment is due.
(9) Interest or other income arising from any payment which is due to an insurer under or in relation to a contract of insurance where the cover commences on or after 1st October 2002 that is received by an exempt reinsurance broker, a general reinsurance broker or a life reinsurance broker from —
(b)
any deposit made under paragraph (3)(c),
may be retained by the insurance broker unless the insurer and the insurance broker have agreed otherwise.
(10) Interest or other income arising from any payment which is due to an insurer under or in relation to a contract of insurance where the cover commences before 1st October 2002 that is received by an insurance broker from —
(b)
any deposit made under paragraph (3)(c),
may be retained by the insurance broker for its own benefit and need not be paid into, or retained in, a bank account.
(11) An exempt direct insurance broker or a direct insurance broker who receives any payment which is due to the insurer under or in relation to a contract of insurance shall —
(a)
where the cover commences before 1st October 2002, pay the amount to the insurer not later than 31st December 2002; and
(b)
where the cover commences on or after 1st October 2002, pay the amount within the credit period.
(12)
Paragraph (11)(a) shall not affect any agreement between the insurance broker and the insurer to pay any sum that is due to the insurer under or in relation to a contract of insurance before 31st December 2002.
(13) An exempt insurance broker or a registered insurance broker shall designate any bank account and any deposit placed with a bank under paragraph (3)(c) as an insurance broking premium account, with or without other words of description.
(14) In this regulation —
“bank account” means a bank account maintained by an exempt insurance broker or a registered insurance broker under
section 35ZD(1) of the Act;
“contract of insurance” includes a contract of insurance that is subsequently cancelled;
“credit period” means —
(a)
the period within which the insurance broker has agreed with the insurer to make payments of any amount due to the insurer under or in relation to a contract of insurance; or
(b)
90 days from the date of commencement of cover under the contract of insurance,
whichever is earlier.
(15) Any person who contravenes this regulation shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $50,000.