Introduction
Under Section 1 of The Insurance Business (Bailiwick of Guernsey) Law, 2002 (The Law) no person shall carry on or hold himself out as carrying on insurance business in or from within the Bailiwick, unless he is licensed to do so.
Applications for a licence are defined in The Insurance Business (Licensing) Regulations, 2002 and it is necessary that you read these. However, below is a guide to what is required by the Commission. If you wish to apply for a licence to carry on long-term business, please go to the International Life section.
What is the Commission looking for?
When assessing applications for a licence the Commission takes into account three main factors; that the applicant is fit and proper, that the business plan is commercially acceptable and that management and control are resident in the Bailiwick. The minimum criteria for licensing can be found in Schedule 7 of The Law. In summary the Commission will be considering:
- Integrity and skill of the applicant and controllers;
- Economic benefit to the Bailiwick;
- Whether fit and proper persons are involved;
- Whether the business is directed by at least two individuals;
- The composition of the Board of Directors;
- Whether the business is to be conducted in a prudent manner;
- The appointment of a suitable general representative (the duties of the general representative are detailed in The Insurance Business (Duties of General Representative) Regulations, 2002 and is normally a licensed insurance manager);
- That the business will be carried out in or from within the Bailiwick;
- Minimum levels of capital and solvency are met and maintained.
How to apply
International insurers are normally managed by licensed insurance managers who will run the company for you and be your general representative. One of these managers should be your first port of call. They will be able to guide you through the application process. Contact details of currently licensed managers are available.
An Application Form must be received from every applicant along with the relevant fee. If you are applying for a licence for a Protected Cell Company, please use the PCC Application form. If you are applying for consent for a cell of a Protected Cell Company, please use the Cell Application Form. The application form will answer most of the points contained in the regulations, however there is also additional information required, detailed below.
Financial Projections
Financial projections for at least the first three years of operation should be included with the application, these should include:
- forecast profit and loss account, broken down into a technical and non-technical account,
- forecast balance sheet,
- forecast statement of solvency at the end of each year.
These projections should have been subject to the appropriate stress and scenario testing. Please refer to the Guidance Notes for Licensed Insurers on Resilience Testing.
Business Plan
A business plan should be submitted in the standard spreadsheet format and accompanied by a narrative. A business plan in narrative format must be submitted.
Further information and examples of narrative and spreadsheet business plans are available.
Confirmation of Receipt of Share Capital
Before a licence can be granted the Commission needs to receive confirmation that the share capital has been issued and that consideration has been received in cash or that letters of credit and subordinated loans are in place and available to the applicant.
Business from Sensitive Sources
If the applicant, controller or ultimate holding company is from a sensitive jurisdiction, as advised from time to time by the Commission in its Business from Sensitive Sources Notices, the Commission will require additional information.
Further information is available on:
On going supervision (International Insurers)
Submission of Annual Return |
