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Current issues in General Insurance
Reinsurance – Regulations and Opportunities
3 July 2015
© Lloyd’s 2012
Disclaimer
► Our understanding is that India is looking to develop itself
as an international (re)insurance center besides, having
SEZ as a (re) insurance hub, seeking to attract (re)
insurers to underwrite both onshore and offshore
business
► There’s also an objective to promote Ease of Doing
Business in line with the International Best Practices
► India is also looking ensure that it benchmarks with the
other Hubs – Hong Kong, Singapore and also with Dubai
International Financial Centre
► The following comments are therefore to accommodate
these objectives rather than to cater to any external entity
© Lloyd’s 2012
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Regulations for Registration and Operations of
Branch Offices of Foreign Reinsurers (excluding
Lloyd’s)
► Procedure for registration
► Requisition for registration application
► Eligibility norms
► Consideration of requisition for registration application
► Application for registration and its consideration
► Conditions governing the registration of branches of
foreign reinsurers
► Manner of computation of annual fee
► Operational issues pertaining to Branch offices of foreign
reinsurer
© Lloyd’s 2012
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Regulations for Registration and Operations of
Branch Offices of Foreign Reinsurers (excluding
Lloyd’s)
► Operational issues pertaining to Branch offices of foreign
reinsurer
– Geographical Scope
– Appointment of Chief Executive Officer and Key
Management Personnel
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– Outsourcing
– Accounting and Investments
– Reinsurance and Retrocession
– Order of preference for cessions by Indian Insurers
– Repatriation of surplus
– Delegated authorities
– Supervision and Control
© Lloyd’s 2012
IRDAI (IFSC) Guidelines 2015
► Reinsurance Business
– Eligibility Criteria
– Application and consideration for registration
– Scope of Operations
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– Assigned Capital
► Direct insurance Business in SEZ
► Terms, conditions and requirements of Certification of
Registration
► Applicability of the provisions of Insurance Act, 1938
© Lloyd’s 2012
Building a successful (re)insurance hub:
Lessons from Dubai and Singapore
►
Dubai and Singapore are the undisputed reinsurance centers for Middle East and
Emerging Asia
►
It’s a consequence of acute foresight and careful economic engineering
►
Ingredients of a reinsurance hub
– Economic and political stability
– Quality of local legislation and regulation
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– Ease of Doing Business
– Cosmopolitan environment
– Availability (importability) of highly skilled finance professionals
– Adequate education and training facilities
– Competitive tax environment
– Convenient geographical location
►
Available capacity for mainline and niche segments
► Cluster of services – specialized lawyers, Loss adjusters, Risk Engineers, forensic
Accountants and HR Consultants etc.
© Lloyd’s 2012
DIFC – A purposefully built free zone
► DIFC offers its member companies major benefits
– Full foreign ownership
– Zero tax rate
– No restrictions on capital convertibility
– No restrictions on profit repatriation
– Cluster of reinsurers, Lloyd’s cover holders, MGAs and other
specialized service providers
► The Free Zone has its own independent regulator: DFSA
– Committed to risk and principles based approach
– Offers independent common law judiciary with jurisdictions
over civil and commercial disputes
► Cluster of 18 (re) insurers, 37 intermediaries and 16
specialized services
© Lloyd’s 2012
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Singapore – a nation wide regulatory
framework
► The (re)insurance hub of Singapore offers a common, nation-
wide legal and regulatory framework for both onshore and
offshore business
► Singapore has become world’s most competitive economy
– English common law system
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– Sophisticated regulatory environment
– Competitive tax rules (10% corporate tax for offshore
business)
– Superior quality of living and a deep talent pool
– Removal of foreign ownership limits and Risk Based Capital
framework
– Singapore has 78 direct insurers, 31 reinsurers, 64 captives,
and 73 Brokers – operators regulated through SIF & OIF
© Lloyd’s 2012
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►Thank You
© Lloyd’s 2012