IITO is “An Order to provide for the licensing and regulation of persons carrying on international insurance business and international insurance-related activities, to provide for the security and protection of long-term international insurance business and to provide for matters incidental thereto or connected therewith”. It deals with all classes of general and long-term international insurance and Takaful, including specifically, financial loss, all classes of captive, linked long-term, pension and annuity and re-insurance as well as Re-Takaful business. It introduces statutory protection (in the absence of fraud) of all long-term products and funds transferred to such contracts, and redefines concepts of insurable interest and enforceability.
The Authority appointed by His Majesty specifically for the purposes of administering and supervising the IITO is the Permanent Secretary of the Ministry of Finance, together with his delegates. The Authority shall keep all information acquired in relation to its functions under the IITO confidential. (sections 3 & 4)
International insurance business (i.e. non-domestic business, conducted with non-residents, with the exception of re-insurance) must be carried on by an IBC or a foreign international company incorporated under the International Business Companies Order, 2000 (“IBCO”), a company incorporated under the (domestic) Companies Act (Chapter 39) or a company registered under Part IX of the Companies Act (Chapter 39), which holds a valid licence under IITO. Further, no person (including a corporation) may carry on any business as an international insurance manager, international underwriting manager or international insurance broker unless he holds a licence relating to such business. (section 5)
Subject to section 7 (discretion for Authority to require greater or permit a lesser amount), the working funds of an applicant shall meet requirements prescribed by the Minister by notice in the Gazette, and until so prescribed:-
a、 where the applicant proposes to carry on long-term insurance business (other than linked long-term business only), shall be at least Brunei $500,000 or its equivalent in any foreign currency;
b、 where the applicant proposes to carry on only general insurance business, shall be at least $250,000 or its equivalent;
c、 where the applicant proposes to carry on only re-insurance business, shall be at least $1,000,000 or its equivalent;
d、 where the applicant proposes to carry on both general and long-term insurance business shall be at least $750,000 or its equivalent currency;
e、 where the applicant proposes to carry on only international captive insurance business shall be at least $75,000 or its equivalent in any foreign currency or, if the applicant is a Dedicated Cell Company (under IBCO) having two or more cells, at least $75,000 or its equivalent in any foreign currency in respect of each cell;
f、 where the applicant proposes to carry on only linked long-term business, shall be at least $100,000 or its equivalent in any foreign currency plus such amount (if any) as the applicant may deem prudent having regard to that portion of any linked long-term business under which the benefits payable exceed benefits determined by reference to the linked investment.
Every applicant must satisfy the Authority:
i. that it meets the prescribed requirements for working capital and that such specified working capital is certified held in a bank in Brunei Darussalam
ii. its controllers, directors and chief executive officers must be approved
iii. management with adequate knowledge and expertise must be established in Brunei Darussalam and at least one director must be a resident or a licensed international underwriting manager in Brunei Darussalam appointed. (sections 6 & 7).
Section 7 provides that the Authority may, having regard to the nature, extent and volume of the international insurance business of an applicant specify in writing a greater or a lesser amount of working funds; and specify an amount (not to exceed 60% of the amount specified under section 6) which may be provided by way of guarantee from a person and in a form acceptable to the Authority.
Every application for a licence must be submitted to the Authority in the prescribed form accompanied by the prescribed fee. (section 8)
Every application must include a business plan for the first three years of operation; copies of the applicant’s constituent documents, where applicable a copy of the applicant's audited annual accounts for the 3 consecutive years immediately preceding the application, and in the case of a takaful or re-takaful provider, the names of the Shari'ah Council duly appointed to advise that provider. The Authority may request further or other information or documents. (sections 9 & 10)
Every applicant must satisfy the Authority that the controllers, directors and chief executive officers of the applicant are fit and proper persons having knowledge of the insurance related activities proposed to be conducted and is able to maintain sufficient funds to cover its expenses in the proposed activities for the period covered by its business plan. Every application for a licence must be submitted to the Authority in the prescribed form accompanied by the prescribed fee. (section 11).
The Authority will keep a Register of all licensees and such Register is to be open to public inspection. (section 14)
Detailed provision is made for surrender of a license and the consequences of so doing, and of revocation (section 16)
All material changes in structure, ownership, controllers or senior personnel must be notified, and in the case of IBCs or domestic companies, approved. (section 18)
Annual Fees fall due on the anniversaries of the initial licence grant::
|
SECTION |
ITEM |
FEE (US$) |
|
19 |
International Insurer carrying Out -
General Insurance Business
Life Insurance Business
Life And General Insurance Business
Captive Insurance Business |
$6,000
$6,000
$12,000
$1,500 |
|
19 |
International Insurance Manager
International Underwriting Manager
International Insurance Broker |
$1,500
$1,500
$1,500 |
Financial Requirements
Protection of Long-Term Business (Part VII)