PART 2 | CONDUCT OF INSURANCE BUSINESS |
| Division 1 — General restriction on insurers |
[11/2013] | No person to carry on insurance business unless licensed or authorised by Authority |
| 4.—(1) Subject to the provisions of this Act, a person must not carry on any class of insurance business in Singapore as an insurer unless the person is licensed by the Authority under this Act in respect of that class of business. [23/2003; 11/2013] (2) Except for a licensed insurer or a foreign insurer carrying on insurance business in Singapore under a foreign insurer scheme, a person carrying on reinsurance business outside Singapore must not carry on the business of providing the reinsurance of liabilities under insurance policies, as a principal and as an insurer, to persons in Singapore unless — | (a) | the person is authorised by the Authority under section 42 to do so; or | | (b) | the person is providing the reinsurance of liabilities under insurance policies pursuant to an arrangement which was not solicited by the person but was initiated by —| (i) | a licensed insurer; | | (ii) | a registered insurance broker; or | | (iii) | a person exempt from registration as an insurance broker under section 92(1)(a), (b), (c), (d), (e) or (f) who has notified the Authority, in such manner as may be prescribed under section 154(1), of its commencement of insurance broking business. [11/2013] |
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(3) Any person licensed by the Authority under this Act to carry on insurance business as an insurer in respect of life business may carry on general business relating to short-term accident and health policies while being so licensed, and —| (a) | the person need not be licensed as an insurer in respect of general business in order to carry on general business relating to short-term accident and health policies; and | | (b) | the general insurance business relating to short-term accident and health policies carried on by the person is treated as part of the person’s life business. [11/2013] |
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| (4) An insurer licensed to carry on both life business and general business may treat its short-term accident and health policies as part of its life business or its general business. [11/2013] |
(5) Any person who contravenes subsection (1) or (2) shall be guilty of an offence and shall be liable on conviction —| (a) | in the case of an individual, to a fine not exceeding $125,000 or to imprisonment for a term not exceeding 3 years or to both and, in the case of a continuing offence, to a further fine not exceeding $12,500 for every day or part of a day during which the offence continues after conviction; or | | (b) | in any other case, to a fine not exceeding $250,000 and, in the case of a continuing offence, to a further fine not exceeding $25,000 for every day or part of a day during which the offence continues after conviction. [3 [11/2013] |
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| Holding out as licensed insurer or authorised reinsurer |
5.—(1) Where any person holds himself, herself or itself out, or purports to hold himself, herself or itself out, to be a licensed insurer or an authorised reinsurer in respect of life business or general business, or both, when that person is not licensed or authorised under this Act in respect of that business —| (a) | that person shall be guilty of an offence; and | | (b) | where that person is a corporation, limited liability partnership or firm, every director, manager or officer of the corporation and every partner or officer of the firm and every partner or manager of the limited liability partnership (as the case may be) shall, unless the person proves that the offence was committed without the person’s knowledge or consent, be guilty of an offence. [11/2013] |
(2) Any person who is guilty of an offence under subsection (1) shall be liable on conviction —| (a) | in the case of an individual, to a fine not exceeding $125,000 or to imprisonment for a term not exceeding 3 years or to both and, in the case of a continuing offence, to a further fine not exceeding $12,500 for every day or part of a day during which the offence continues after conviction; or | | (b) | in any other case, to a fine not exceeding $250,000 and, in the case of a continuing offence, to a further fine not exceeding $25,000 for every day or part of a day during which the offence continues after conviction. [4 [11/2013] |
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6.—(1) Subject to subsection (3) and except with the written consent of the Authority, a person, other than a licensed insurer, an authorised reinsurer or a foreign insurer carrying on insurance business in Singapore under a foreign insurer scheme, must not —| (a) | use the word “insurance” or any of its derivatives in any language, or any other word indicating that that person carries on insurance business in the name, description or title under which it carries on business in Singapore; or | | (b) | make any representation to such effect in any bill head, letter paper, notice, advertisement or in any other manner. [23/2003; 11/2013] |
(2) Subject to subsections (4) and (5) and except with the written consent of the Authority, a person must not —| (a) | use the word “insurance” or any of its derivatives in any language, or any other word, that indicates that the person carries on business as an insurance intermediary in the name, description or title under which it carries on business in Singapore; or | | (b) | make any representation to such effect in any bill head, letter paper, notice, advertisement or in any other manner. [23/2003; 11/2013] |
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| (3) Subsection (1) does not apply to any registered person as defined in section 9(9). [11/2013] |
(4) Subsection (2) does not apply to —| (a) | a registered insurance broker; | | (b) | a person exempt from registration as an insurance broker under section 92(1)(a), (b), (c), (d), (e) or (f) who has notified the Authority, in such manner as may be prescribed under section 154(1), of the person’s commencement of insurance broking business; | | (c) | a licensed financial adviser or an exempt financial adviser, which provides any financial advisory service in respect of life policies; | | (d) | an insurance agent operating under a written agreement pursuant to section 64; | | (e) | an insurance agent to whom section 64 does not apply; | | (f) | an agent of a foreign insurer carrying on insurance business in Singapore under a foreign insurer scheme; or | | (g) | such other person as may be prescribed. [23/2003; 11/2013] |
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| (5) Any person allowed under subsection (2) to use any word referred to in that subsection in the name, description or title under which the person carries on business in Singapore must, when using that word in that name, description or title, indicate that the person carries on business as an insurance intermediary. [11/2013] |
| (6) Nothing in this section prohibits an association of insurers from using the word “insurance” or any of its derivatives in any language as part of its name or description of its activities. |
(7) Any person who contravenes subsection (1), (2) or (5) shall be guilty of an offence and shall be liable on conviction —| (a) | in the case of an individual, to a fine not exceeding $12,500 or to imprisonment for a term not exceeding 12 months or to both and, in the case of a continuing offence, to a further fine not exceeding $1,250 for every day or part of a day during which the offence continues after conviction; or | | (b) | in any other case, to a fine not exceeding $25,000 and, in the case of a continuing offence, to a further fine not exceeding $2,500 for every day or part of a day during which the offence continues after conviction. [5 [11/2013] |
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| Restrictions on co-branding |
7.—(1) Except with the prior written consent of the Authority, a licensed insurer, authorised reinsurer or foreign insurer carrying on insurance business in Singapore under a foreign insurer scheme must not use, together with its name, logo or trade mark in the course of the business it carries on in Singapore, the name, logo or trade mark of any person who —| (a) | carries on the business of assuming risk or undertaking liability under policies, whether in Singapore or elsewhere; but | | (b) | is not a licensed insurer, an authorised reinsurer or a foreign insurer carrying on insurance business in Singapore under a foreign insurer scheme. [11/2013] |
| (2) Any insurer which contravenes subsection (1) shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $100,000 and, in the case of a continuing offence, to a further fine not exceeding $10,000 for every day or part of a day during which the offence continues after conviction. [5A [11/2013] |
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| Prohibition relating to solicitation of insurance business |
8.—(1) Subject to subsection (5), a person must not solicit any insurance business for any insurer other than —| (a) | a licensed insurer; | | (b) | an authorised reinsurer; | | (c) | a foreign insurer carrying on insurance business in Singapore under a foreign insurer scheme; or | | (d) | any other insurer entitled to carry on insurance business in Singapore. [11/2013] |
(2) Subject to subsection (5), a person who solicits any insurance business for a licensed insurer or an insurer referred to in subsection (1)(d) —| (a) | may only solicit in respect of the insurance business in Singapore of that insurer; and | | (b) | must not solicit in respect of the insurance business of —| (i) | any branch located outside Singapore of that insurer; or | | (ii) | where that insurer is incorporated, formed or established outside Singapore, its head office. [11/2013] |
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(3) Any person who contravenes subsection (1) or (2) shall be guilty of an offence and shall be liable on conviction —| (a) | in the case of an individual, to a fine not exceeding $125,000 or to imprisonment for a term not exceeding 3 years or to both and, in the case of a continuing offence, to a further fine not exceeding $12,500 for every day or part of a day during which the offence continues after conviction; or | | (b) | in any other case, to a fine not exceeding $250,000 and, in the case of a continuing offence, to a further fine not exceeding $25,000 for every day or part of a day during which the offence continues after conviction. [11/2013] |
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(4) A person whose business it is to publish or to arrange for the publication of advertisements shall not be guilty of an offence under subsection (3) if the person proves that —| (a) | the person received the advertisement for publication in the ordinary course of the person’s business; | | (b) | the matters contained in the advertisement were not, wholly or in part, devised or selected by the person or by any person under the person’s direction or control; and | | (c) | the person did not know and had no reason for believing that the publication of the advertisement would constitute an offence. [11/2013] |
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| (5) Subsections (1) and (2) do not apply to such persons or class of persons as the Authority may prescribe, subject to such terms or conditions as the Authority may prescribe. [11/2013] |
(6) In this section, unless the context otherwise requires —“advertisement” means the dissemination or conveyance of information, or invitation or solicitation by any means or in any form, including by means of —| (a) | publication in a newspaper, magazine, journal or other periodical; | | (b) | display of posters or notices; | | (c) | circulars, handbills, brochures, pamphlets, books or other documents; | | (d) | letters addressed to individuals, bodies corporate or bodies unincorporate; | | (e) | photographs or cinematograph films; or | | (f) | sound broadcasting, television, the Internet or other media, |
| but does not include an advertisement issued outside Singapore that is made available — |
| (g) | in a newspaper, magazine, journal or other periodical published and circulating principally outside Singapore; | | (h) | in a sound or television broadcast transmitted principally for reception outside Singapore; or | | (i) | by any other means of broadcasting or communication principally for circulation or reception outside Singapore; |
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“solicit”, in relation to insurance business —| (a) | means, whether in Singapore or elsewhere, offering to, inviting, or issuing any advertisement containing any offer or invitation to, the public or any section of the public in Singapore to enter into a contract of insurance; and | | (b) | the reference to an advertisement in paragraph (a) includes an advertisement containing information which is, or might reasonably be presumed to be, intended to lead, directly or indirectly, to the entering into of a contract of insurance. [11/2013] |
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| (7) For the purposes of this section, in determining whether an offer, invitation or advertisement is made or issued to the public or any section of the public in Singapore, regard must be had to such considerations as the Authority may prescribe. [6 [11/2013] |
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| Registration of representative office |
| 9.—(1) A person must not establish or operate a representative office unless the representative office is registered with the Authority. [11/2013] (2) Any person who desires to establish and operate a representative office must —| (a) | apply in writing to the Authority for registration under this section; and | | (b) | provide any information or document that the Authority may require. [11/2013] |
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(3) The Authority must refuse to register a representative office unless —| (a) | the applicant is a company, or a company incorporated outside Singapore; and | | (b) | the applicant satisfies such criteria as may be determined by the Authority. [11/2013] |
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| (4) The Authority may register a representative office subject to any conditions that it considers necessary, and the registered person must comply with the conditions of registration imposed by the Authority under this section. [11/2013] |
| (5) The Authority may at any time add to, vary or revoke any condition of registration, or impose a condition of registration. [11/2013] |
| (6) Every registered person must provide any information or document that the Authority may require from time to time. [11/2013] |
(7) The Authority may cancel the registration of a representative office if the registered person contravenes —| (a) | any condition of registration imposed by the Authority; or | | (b) | any provision of this Act. [11/2013] |
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(8) Any person who contravenes subsection (1) or (6), fails to comply with any condition of registration imposed by the Authority under subsection (4) or (5), or operates a representative office which has had its registration cancelled by the Authority under subsection (7), shall be guilty of an offence and shall be liable on conviction —| (a) | in the case of an individual, to a fine not exceeding $50,000 or to imprisonment for a term not exceeding 2 years or to both and, in the case of a continuing offence, to a further fine not exceeding $5,000 for every day or part of a day during which the offence continues after conviction; or | | (b) | in any other case, to a fine not exceeding $100,000 and, in the case of a continuing offence, to a further fine not exceeding $10,000 for every day or part of a day during which the offence continues after conviction. [11/2013] |
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(9) In this section, unless the context otherwise requires —| “registered person” means a person whose representative office is registered with the Authority under this section; |
“representative office” means an office in Singapore established —| (a) | by a person who —| (i) | intends to carry on insurance business in Singapore; and | | (ii) | is not an authorised reinsurer, and does not carry on any insurance business or any other business in Singapore; and |
| | (b) | to carry out liaison work, market research or feasibility studies for the use of that person. [6A [11/2013] |
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| Examination of persons suspected of carrying on insurance business |
10.—(1) Whenever the Authority has reason to believe that a person has contravened any of the provisions of this Act, it may call for or inspect the books, accounts and records of that person in order to ascertain whether or not that person has contravened or is contravening any of the provisions of this Act.(2) Any person who wilfully refuses to submit such books, accounts and records or to allow the inspection thereof shall be guilty of an offence and shall be liable on conviction —| (a) | in the case of an individual, to a fine not exceeding $50,000 or to imprisonment for a term not exceeding 2 years or to both and, in the case of a continuing offence, to a further fine not exceeding $5,000 for every day or part of a day during which the offence continues after conviction; or | | (b) | in any other case, to a fine not exceeding $100,000 and, in the case of a continuing offence, to a further fine not exceeding $10,000 for every day or part of a day during which the offence continues after conviction. [7 [11/2013] |
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| Division 2 — Licensed insurers |
[11/2013] 11.—(1) A person who desires to carry on insurance business in Singapore as an insurer must —| (a) | apply in writing to the Authority for a licence under this section; and | | (b) | provide such information as the Authority may require. [11/2013] |
| (2) Upon receiving an application under subsection (1), the Authority must consider the application and may grant a licence to the applicant with or without conditions or refuse to grant a licence. [11/2013] |
(3) The Authority must not grant a licence to any person unless —| (a) | the applicant is a company, a company incorporated outside Singapore which has an established place of business in Singapore, or a co-operative society; and | | (b) | the applicant satisfies such financial requirements as may be prescribed. [11/2013] |
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| (4) For the purposes of this section, the Authority may prescribe financial requirements of different forms or amounts for different classes of insurance business and for different types of insurers. [11/2013] |
| (5) The Authority may license an insurer as a direct insurer, reinsurer or captive insurer. [11/2013] |
| (6) The Authority must cause notice of the grant of any licence or change of name of a licensed insurer to be published in the Gazette. [11/2013] |
| (7) Any applicant which is aggrieved by the refusal of the Authority to grant it a licence under this section may, within 30 days after being informed of the decision of the Authority, appeal to the Minister in writing in accordance with Part 3B. [11/2013] |
| (8) The Authority may at any time add to, vary or revoke any of the existing conditions of the licence of an insurer or impose any condition thereto. [11/2013] |
| (9) A licensed insurer must, at all times during the currency of its licence, satisfy such financial requirements as may be prescribed under subsection (3)(b). [11/2013] |
| (10) Any licensed insurer which fails to comply with any condition imposed by the Authority under subsection (2) or (8) shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $100,000 and, in the case of a continuing offence, to a further fine not exceeding $10,000 for every day or part of a day during which the offence continues after conviction. [11/2013] |
| (11) Any licensed insurer which contravenes subsection (9) shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $250,000 and, in the case of a continuing offence, to a further fine not exceeding $25,000 for every day or part of a day during which the offence continues after conviction. [8 [11/2013] |
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| Annual fees of licensed insurers |
| 12.—(1) Every licensed insurer must pay to the Authority such annual fees as may be prescribed. [23/2003; 11/2013] | (2) The Authority may prescribe different annual fees for different classes of insurance business or for different types of licensed insurers. [23/2003; 11/2013] |
| (3) The Authority may, where it considers appropriate in a particular case, waive, refund or remit the whole or any part of any annual fee paid or payable under subsection (1). [11 [11/2013] |
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| 13.—(1) The Authority may by order cancel the licence of any insurer, either wholly or in respect of a class of business, at the request of the insurer or on any of the grounds set out in subsection (3). [11/2013] | (2) The Authority may impose any conditions that it thinks fit before cancelling the licence of an insurer at the request of the insurer under subsection (1), and the Authority may refuse to cancel the licence if the insurer does not comply with the conditions. [11/2013] |
(3) The grounds referred to in subsection (1) are as follows:| (a) | the insurer has not commenced business within 12 months after being licensed; | | (b) | the insurer has ceased to carry on insurance business whether wholly or in respect of any class of business; | | (c) | it appears to the Authority that the insurer has failed to satisfy an obligation to which the insurer is subject by virtue of this Act; | | (d) | there exists a ground on which the Authority would have been prohibited under section 11(3) from licensing the insurer; | | (e) | the insurer proposes to make or has made any composition or arrangement with its creditors, has gone into liquidation or has been wound up or otherwise dissolved; | | (f) | a receiver, a receiver and manager, or any other person having the powers and duties of a receiver, or a receiver and manager, has been appointed, whether in Singapore or elsewhere, in relation to, or in respect of any property of, the insurer or any of the shareholders of the insurer having control of the insurer; | | (g) | there is a change of a person having control of the insurer, and —| (i) | the new person having control of the insurer is not a fit and proper person; or | | (ii) | the Authority is not satisfied as to the financial standing of the insurer after the change; |
| | (h) | the insurer is carrying on its business in a manner likely to be detrimental to the interests of its policy owners; | | (i) | the insurer is unable to meet its obligations; | | (j) | the insurer has failed to effect satisfactory reinsurance arrangements; | | (k) | the insurer has contravened or is contravening —| (i) | any condition of its licence; | | (ii) | any direction given by the Authority under this Act; or | | (iii) | any provision of this Act; |
| | (l) | any of the officers of the insurer holding a managerial or executive position has been convicted of any offence under this Act committed before, on or after 18 April 2013; | | (m) | the insurer has provided false, misleading or inaccurate information, or has concealed or failed to disclose material facts, in its application for a licence; | | (n) | the insurer, if incorporated outside Singapore, has had its licence or authority to operate withdrawn by the supervisory authority which is responsible, under the laws of the foreign country where the insurer is incorporated, for supervising the insurer; | | (o) | the insurer has contravened or is contravening any provision of the Deposit Insurance and Policy Owners’ Protection Schemes Act 2011 or any Rules issued by the deposit insurance and policy owners’ protection fund agency under that Act; | | (p) | it is in the public interest to cancel the licence. [11/2013] |
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(4) Before cancelling the licence of an insurer under subsection (1) other than at the request of the insurer, the Authority must —| (a) | give the insurer written notice of the Authority’s intention to do so; and | | (b) | in the notice referred to in paragraph (a), call upon the insurer to show cause, within such time as may be specified in the notice, as to why the licence should not be cancelled. [11/2013] |
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(5) If the insurer referred to in subsection (4) —| (a) | fails to show cause within the time specified under subsection (4)(b) or within such extended period of time as the Authority may allow; or | | (b) | fails to show sufficient cause, |
| the Authority must give written notice to the insurer of the date on which the cancellation of the licence is to take effect. |
[11/2013] |
| (6) An order to cancel the licence of any insurer made under subsection (1) other than at the request of the insurer does not take effect until the expiration of a period of 30 days after the Authority has informed the insurer of the cancellation under subsection (5). [11/2013] |
| (7) Any insurer which is aggrieved by a decision of the Authority under subsection (1) to cancel the insurer’s licence other than at the insurer’s request may, within 30 days after the Authority has informed the insurer of the cancellation under subsection (5), appeal to the Minister in writing in accordance with Part 3B. [11/2013] |
| (8) If, within the period referred to in subsection (7), the insurer concerned gives due notice of appeal to the Minister, the order by the Authority to cancel the licence of the insurer does not take effect unless the order is confirmed by the Minister or the appeal is for any reason dismissed by the Minister. [11/2013] |
(9) Despite the cancellation of the licence of an insurer under subsection (1), so long as the insurer remains under any liability in respect of insurance policies belonging to the class of insurance business to which the licence relates, the insurer must take any action that it considers necessary or as required by the Authority to ensure that —| (a) | reasonable provision has been or will be made for that liability; and | | (b) | adequate arrangements exist or will exist for payment of premiums and claims on those policies. [11/2013] |
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(10) For the purposes of this section —| (a) | a person is regarded as having control of an insurer if the person alone or together with any associate or associates —| (i) | holds 20% or more of the total number of issued shares in the insurer; or | | (ii) | is in a position to control 20% or more of the voting power in the insurer; |
| | (b) | a reference to voting power in an insurer is a reference to the total number of votes that might be cast in a general meeting of the insurer; | | (c) | a person, A, is an associate of another person, B, if —| (i) | A is the spouse, or a parent, remoter lineal ancestor or step-parent, a son, daughter, remoter issue, stepson or stepdaughter, or a brother or sister of B; | | (ii) | A is a body corporate that is, or a majority of the directors of which are, accustomed or under an obligation whether formal or informal to act in accordance with the directions, instructions or wishes of B; | | (iii) | A is a person who is accustomed or under an obligation, whether formal or informal, to act in accordance with the directions, instructions or wishes of B; | | (iv) | A is a subsidiary of B; | | (v) | A is a body corporate in which B, alone or together with other associates of B as described in sub‑paragraphs (ii), (iii) and (iv), is in a position to control at least 20% of the voting power in A; or | | (vi) | A is a person with whom B has an agreement or arrangement, whether oral or in writing and whether express or implied, to act together with respect to the acquisition, holding or disposal of shares or other interests in, or with respect to the exercise of their voting power in relation to, the insurer; and |
| | (d) | a person holds a share if —| (i) | the person is deemed to have an interest in that share under section 7(6) of the Companies Act 1967; or | | (ii) | the person otherwise has a legal or an equitable interest in that share, except for such interest as is to be disregarded under section 7(7), (8) and (9) of the Companies Act 1967. [12 [11/2013; 35/2014] |
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| Effects of cancellation of licence |
14.—(1) Where an order of cancellation of the licence of an insurer under section 13 becomes effective —| (a) | the Authority must publish a notice of the cancellation in the Gazette; and | | (b) | the insurer must, as from the date of cancellation, cease to carry on insurance business in Singapore wholly or of the class in respect of which its licence has been cancelled, as the case may be. [11/2013] |
(2) Subsection (1)(b) does not prejudice —| (a) | the enforcement by any policy owner or person of any right or claim against the insurer, or by the insurer of any right or claim against any policy owner or person; and | | (b) | the collection or receipt of premiums on insurance policies effected before the date of cancellation of the licence and belonging to the class of insurance business in respect of which the licence has been cancelled, |
| and section 4 does not apply to the insurer in respect of the collection or receipt of the premiums referred to in paragraph (b). |
[11/2013] |
| (3) Despite the cancellation of the licence of an insurer, sections 94 and 95, unless the Authority otherwise directs, continue to apply in relation to the insurer in respect of matters that occurred before the cancellation as if the licence had not been cancelled. [13 [11/2013] |
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15.—(1) Every licensed insurer must establish and keep —| (a) | a register of Singapore policies where it carries on business relating to Singapore policies; and | | (b) | a register of offshore policies where it carries on business relating to offshore policies. [11/2013] |
| (2) Subject to this section, there must be entered in the register of Singapore policies all Singapore policies of the insurer and in the register of offshore policies all offshore policies of the insurer, and a policy entered in any register must not be removed from it so long as the insurer is under any liability in respect of that policy. |
| (3) Subject to this section, there may be entered in the register of Singapore policies such other policies as the insurer, with the consent (express or implied) of the policy owners, may determine, and this Act applies in relation to any policy so entered as if it were a Singapore policy. |
(4) Subject to subsection (5), an insurer carrying on life business outside Singapore (and not doing so only by the collection or receipt of premiums) may, at the request of the policy owner of a policy belonging to the insurer’s life business —| (a) | refrain from entering the policy in the register of Singapore policies, even though it is a Singapore policy; or | | (b) | remove the policy from the register of Singapore policies, |
| and this Act then applies in relation to the policy as if it were not a Singapore policy. |
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| (5) Regulations may provide that subsection (3) or (4) applies only in such cases as may be prescribed or has effect subject to any prescribed exceptions or restrictions. |
| (6) A Singapore insurer must, at the request of any person having an interest in any policy of the insurer, inform the person whether or not the policy is entered in any register of policies established by the insurer under this Act. |
| (7) Where a Singapore insurer has established under this Act any register of policies, the register ceases to exist as a statutory register under this Act of policies belonging to either class of insurance business, if the insurer ceases to be licensed under this Act in respect of that class of business; and any reference in this Act to policies registered under this Act is to be construed accordingly. [11/2013] |
| (8) Subject to subsection (7), any register of policies established by a Singapore insurer must, even if the insurer at any time ceases to carry on in Singapore either class of insurance business, continue to be maintained by the insurer for policies belonging to that class so long as the insurer is under any liability in respect of those policies registered or required to be registered at that time. |
| (9) No policies referred to in subsection (8) belonging to either class of insurance business may be entered in the register under subsection (3) when the insurer is not carrying on that class of business in Singapore, or is doing so only by the collection or receipt of premiums. |
| (10) A register of policies established and kept by an insurer under this section before 1 January 1987 is deemed to be a register of Singapore policies under subsection (1). [16 |
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| Establishment of insurance funds and allocation of surplus |
16.—(1) Every licensed insurer must establish and maintain a separate insurance fund —| (a) | for each class of insurance business carried on by the insurer that relates to Singapore policies; and | | (b) | for each class of insurance business carried on by the insurer that relates to offshore policies. [11/2013] |
(2) Every direct insurer licensed to carry on life business must establish and maintain, in addition to the insurance funds under subsection (1) and subject to such conditions or restrictions as the Authority may impose, separate insurance funds —| (a) | for its investment-linked policies; and | | (b) | for its non-investment-linked policies. [23/2003; 11/2013] |
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(3) If, in the case of a direct insurer licensed to carry on life business, no part of the surplus of assets over liabilities from its non‑participating policies is allocated by the insurer by way of bonus to its participating policies, the insurer must, in addition to the funds maintained under subsections (1) and (2) and subject to such conditions or restrictions as the Authority may impose, establish and maintain, in respect of its non-investment-linked policies, separate insurance funds —| (a) | for its participating policies; and | | (b) | for its non-participating policies. [23/2003 ; 11/2013] |
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| (4) The Authority may require any licensed insurer to establish and maintain, in addition to the insurance funds under subsections (1), (2) and (3), such other insurance fund as the Authority may determine for different types of policies in respect of each class of insurance business. [23/2003; 11/2013] |
| (5) There must be paid into an insurance fund all receipts of the insurer properly attributable to the business to which the fund relates (including the income of the fund), and the assets comprised in the fund must be applicable only to meet such part of the insurer’s liabilities and expenses as is properly so attributable. [16/2011] |
| (6) For the purposes of subsection (5), the Authority may prescribe or specify in directions what constitutes receipts, income, liabilities or expenses of the insurer which are properly attributable to the business to which an insurance fund relates and the manner in which each item is to be determined or valued. [23/2003] |
(7) In the case of an insurance fund maintained by a direct insurer licensed to carry on life business which comprises wholly or partly of participating policies —| (a) | there must be a surplus account, established and maintained in such manner as the Authority may prescribe or specify in directions, as part of the insurance fund; | | (b) | no part of the fund may be allocated by way of bonus to the participating policies except —| (i) | with the approval of the directors of the insurer, upon considering a written recommendation from the actuary appointed under section 35; and | | (ii) | where the making of such allocation does not contravene any condition or restriction that may be prescribed or specified in directions for the purposes of this section; |
| | (c) | no part of the fund may be allocated to the surplus account except —| (i) | with the approval of the directors of the insurer, upon considering a written recommendation from the actuary appointed under section 35; | | (ii) | where the making of such allocation does not contravene the fund solvency requirement under section 17; | | (iii) | where the making of such allocation does not contravene any condition or restriction that may be prescribed or specified in directions for the purposes of this section; and | | (iv) | where the amount does not exceed 1/9th of the amount allocated pursuant to paragraph (b) for a particular accounting period. [23/2003; 11/2013] |
|
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| (8) Despite subsection (7)(c), an insurer may make additional allocations to the surplus account of an insurance fund which comprises wholly or partly of participating policies of an amount and in a manner as prescribed or specified in directions by the Authority. [23/2003] |
| (9) Where the amount allocated to the surplus account in a particular accounting period pursuant to subsection (7)(c) is less than 1/9th of the amount allocated pursuant to subsection (7)(b) for that accounting period, the insurer must not allocate the difference between the amount actually allocated and the 1/9th amount allowed to the surplus account in any subsequent accounting period. [23/2003] |
(10) An insurer may, where there is a surplus of assets over liabilities of an insurance fund, at any time withdraw from the fund an amount not exceeding the surplus over any fund solvency requirement prescribed for that fund under section 17 if and only if —| (a) | there is no provision in any instrument or contract binding the insurer disallowing such a withdrawal; and | | (b) | the insurer ascertains from the latest statement of accounts lodged with the Authority in accordance with section 94 or such other subsequent audited statement of accounts provided to the Authority that there is in fact such a surplus at the time of the withdrawal. [23/2003] |
|
| (11) On the making of any withdrawal in accordance with subsection (10), the surplus of the fund is, for the purposes of this section, treated as reduced by the amount withdrawn. [23/2003] |
| (12) Any amount withdrawn from an insurance fund under subsection (10) and, in a winding up, any part of an insurance fund remaining after meeting the liabilities and expenses to which the fund is applicable may be dealt with as if it had not formed part of the fund except that, in the case of a winding up where any other insurance fund of the insurer under this Act is in deficit, the surplus remaining after the winding up must first be applied to make good the deficit in that fund. [23/2003] |
| (13) Any insurance fund established by an insurer for any class of insurance business must, even if the insurer at any time ceases to carry on that class of business in Singapore, continue to be maintained by the insurer so long as the insurer is required by this Act to maintain a register of policies for policies belonging to that class. |
| (14) The assets of any insurance fund established by an insurer under this Act must be kept separate from all other assets of the insurer. [17 |
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| Fund solvency requirements and capital adequacy requirements |
17.—(1) Every licensed insurer must satisfy —| (a) | such fund solvency requirements in respect of each insurance fund established by the insurer under this Act; and | | (b) | such capital adequacy requirements, |
| as may be prescribed or specified in directions for the purposes of this section. |
[23/2003; 11/2013] (2) The Authority may prescribe or specify in directions —| (a) | different fund solvency requirements or capital adequacy requirements under subsection (1) for different classes of insurance business and for different types of insurers; and | | (b) | in respect of any type of insurers, any exception from the requirements of subsection (1). [23/2003; 11/2013] |
|
(3) Without limiting section 154, regulations made under this Act, or directions made under subsection (1) or (2), may —| (a) | provide for the determination of the value of assets and the amount of liabilities; | | (b) | provide that, for any specified purpose, assets or liabilities of any specified class or description are to be left out of account or are to be taken into account only to a specified extent; and | | (c) | make different provision in relation to different cases or circumstances. [11/2013] |
|
| (4) The Authority may by written notice, if it considers it appropriate in the particular circumstances of a licensed insurer having regard to the risks arising from the activities of the insurer and any other factors that the Authority considers relevant, direct that the insurer satisfy fund solvency requirements or capital adequacy requirements other than those that the insurer is required to maintain under this section. [23/2003; 11/2013] |
| (5) Without limiting section 102, the failure of a licensed insurer to comply with subsection (1) or any direction of the Authority under subsection (4) is sufficient cause for the Authority to be satisfied that the affairs of the insurer are being conducted in a manner likely to be detrimental to the public interest or the interests of the policy owners and to issue such directions under section 102(1) as the Authority may consider necessary. [23/2003; 11/2013] |
| (6) Any licensed insurer which contravenes subsection (1) or fails to comply with a direction of the Authority under subsection (4) shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $250,000 and, in the case of a continuing offence, to a further fine not exceeding $25,000 for every day or part of a day during which the offence continues after conviction. [18 [11/2013] |
|
| Form, investment and situation of assets |
18. The Authority may prescribe or specify in directions, either generally or in such circumstances and to such extent as may be prescribed or specified —| (a) | the manner in which the assets of any insurance fund of a licensed insurer are to be invested and the places in which such assets are to be maintained; and | | (b) | the nature of the assets that is appropriate in relation to the currency in which the liabilities of the insurer are or may be required to be met. [19 [11/2013] |
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| Requirements as to documents evidencing title to assets of insurance funds |
19.—(1) Where an insurer has established an insurance fund under this Act, the insurer must secure that any document evidencing the insurer’s title to assets of the fund, so long as the document is held by or on behalf of the insurer, is kept in Singapore or, if not so kept, is kept in the custody of a person in accordance with such directions as may be issued by the Authority.(2) An insurer who has established an insurance fund under this Act must from time to time notify the Authority in writing —| (a) | the person having the custody of any such document on behalf of the insurer, and the fact of any person ceasing to do so; and | | (b) | the reason why any such document is not held by or on behalf of the insurer, and the identity of the document in question. |
|
| (3) Any such document which is, for the time being, held by or on behalf of the insurer must, on the Authority giving at least 14 days’ notice in writing to the insurer or to the person having the custody of the document, be produced for inspection to the Authority or a person nominated by it by the person to whom the notice is given. |
| (4) Any person who contravenes this section shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $12,500 and, in the case of a continuing offence, to a further fine not exceeding $1,250 for every day or part of a day during which the offence continues after conviction. [20 [11/2013] |
|
| Maintenance of assets by licensed insurers |
| 20.—(1) The Authority may, from time to time, by written notice to any licensed insurer, or any class of licensed insurers, direct the insurer or class of insurers (as the case may be) each to maintain and hold such minimum amount or amounts of assets in Singapore as may be specified in the notice for the purpose of meeting its liabilities. [11/2013] (2) Without limiting subsection (1), the Authority may, in a notice issued under that subsection, specify —| (a) | the types of liabilities in respect of which assets are to be maintained and held in Singapore; | | (b) | the types of assets that are to be treated as assets maintained and held in Singapore, and the minimum amount or amounts in respect of each asset for the purpose of any requirement of the Authority under that subsection; and | | (c) | the method for the valuation of assets maintained and held in Singapore, including any deduction to be made in respect of the assets. [11/2013] |
|
| (3) Where the Authority issues a notice under subsection (1) to a class of licensed insurers, the Authority may direct different insurers within the class of insurers to maintain and hold different minimum amounts of assets in Singapore, having regard to the financial soundness of each insurer, the risk profile of each insurer and such other factors as the Authority may consider relevant. [11/2013] |
| (4) Any licensed insurer which fails to comply with any direction of the Authority under subsection (1) shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $250,000 and, in the case of a continuing offence, to a further fine not exceeding $25,000 for every day or part of a day during which the offence continues after conviction. [21 [11/2013] |
|
| Custody of assets of licensed insurers |
| 21.—(1) The Authority may, in the case of a licensed insurer on which a requirement has been imposed under section 20, impose an additional requirement that the whole or a specified proportion of the assets to which the requirement under that section applies must be held by a person approved by the Authority for the purposes of the requirement under this section as trustee for the insurer. [23/2003; 11/2013] (2) Assets of a licensed insurer held by a person as trustee for the insurer are taken to be held by the person in compliance with a requirement imposed under this section if, and only if —| (a) | they are assets which the insurer has given the person notice are to be held by the person in compliance with such a requirement; or | | (b) | they are assets into which assets which the insurer has given the person such written notice have, by any transaction or series of transactions, been transposed by the person on the instructions of the insurer. [23/2003; 11/2013] |
|
| (3) No assets held by a person as trustee for a licensed insurer in compliance with a requirement imposed under this section may, so long as the requirement is in force, be released except with the written consent of the Authority. [23/2003; 11/2013] |
| (4) If a mortgage or charge is created by a licensed insurer at a time when there is in force a requirement imposed on the insurer by virtue of this section, being a mortgage or charge conferring a security on any assets which are held by a person as trustee for the insurer in compliance with the requirement, the mortgage or charge, to the extent that it confers such a security, is void against the liquidator and any creditor of the insurer. [22 [23/2003; 11/2013] |
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| Regulation of premiums under life policies and long-term accident and health policies |
| 22.—(1) A direct insurer licensed to carry on life business must not issue a life policy or a long-term accident and health policy of any description, being a Singapore policy or an offshore policy, if the premium chargeable under the policy is not in accordance with rates fixed with the approval of the actuary appointed under section 35 or, where no rates have been so fixed for policies of that description issued by the insurer, is not a premium approved for the policy by the actuary. [23/2003; 11/2013] (2) The Authority may, by written notice, require a direct insurer licensed to carry on life business to obtain and provide it within the time specified in the notice with —| (a) | a report by the actuary appointed under section 35 as to the suitability of the rates of premium for the time being chargeable by the insurer for any description of life policy or long-term accident and health policy; and | | (b) | if the actuary considers that the rates of premium are not suitable or not in accordance with sound insurance principles, a report as to the rates of premium which the actuary approves for that description of policy. [23/2003; 11/2013] |
|
| (3) For the purpose of subsection (1), regard must be had to any report referred to in subsection (2) to the exclusion of any previous approval or report. [23/2003] |
| (4) For each occasion on which an insurer issues a policy in contravention of this section, the insurer shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $25,000. [24 [23/2003; 11/2013] |
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| Control of form of proposals, policies and brochures |
23.—(1) The Authority may, by written notice, require a Singapore insurer to submit to it —| (a) | the forms of proposal and policy for the time being in use by the insurer in Singapore; and | | (b) | any brochure which is for the time being in use by the insurer for describing the terms or conditions of, or the benefits to be or likely to be derived from, policies. |
| (2) Where the whole or part of any such form or brochure required under subsection (1) is not in English, there must be submitted with it a translation in English. |
| (3) Unless it is otherwise provided, a requirement under this section applies to all such forms and brochures coming into use after the making of the requirement and before the Authority notifies the insurer that the requirement is withdrawn. |
(4) If it appears to the Authority, after affording the insurer an opportunity to make representations orally or in writing, that any such form or brochure —| (a) | contravenes any of the provisions of this Act; or | | (b) | is in any respect likely to mislead, |
| the Authority may, by written notice, direct the insurer to discontinue the use of the form or brochure in Singapore either immediately or from a date specified in the notice. |
|
| (5) A Singapore insurer must not use, in the course of carrying on insurance business in Singapore, a form of proposal which does not have prominently displayed therein a warning that if a proposer does not fully and faithfully give the facts as the proposer knows them or ought to know them, the proposer may receive nothing from the policy. |
| (6) For each occasion on which any insurer uses a copy of a form or brochure in contravention of subsection (4) or (5), the insurer shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $25,000 and, in the case of a continuing offence, to a further fine not exceeding $2,500 for every day or part of a day during which the offence continues after conviction. [11/2013] |
| (7) In this section, “brochure” includes any leaflet, circular or similar advertising matter, whether printed or not. [25 |
|
| Regulation of payment of remuneration |
24.—(1) Any licensed insurer must not pay to any licensed financial adviser or exempt financial adviser, or a representative or a supervisor of any licensed financial adviser or exempt financial adviser, any remuneration in relation to —| (a) | the provision of any financial advisory service in connection with any life policy; or | | (b) | the sale of any life policy following the provision of any financial advisory service, |
| except in accordance with regulations made under section 154 or a written notice issued by the Authority. |
[19/2015] (2) The regulations or written notice referred to in subsection (1) may prescribe or specify the following:| (a) | the type and amount of the remuneration which may be payable in any particular period; | | (b) | how the payment is to be made. [19/2015] |
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(3) Subsection (1) applies only to payment of remuneration which accrues —| (a) | on or after 1 January 2016; and | | (b) | under any agreement or arrangement whether made before, on or after 1 January 2016. [19/2015] |
|
(4) Any licensed insurer required to comply with subsection (1) must do so despite —| (a) | any written law in force on 1 January 2016 or any rule of law to the contrary; or | | (b) | any agreement or arrangement entered into before, on or after 1 January 2016. [19/2015] |
|
(5) Any licensed insurer which complies with subsection (1) is not to be treated as having breached —| (a) | any rule of law or written law referred to in subsection (4)(a); or | | (b) | any agreement or arrangement referred to in subsection (4)(b) which was entered into before 1 January 2016, |
| and no such agreement or arrangement is taken to be brought to an end by frustration solely by reason of any act done in compliance with subsection (1), or any regulation or written notice referred to in that subsection. |
[19/2015] |
| (6) Any licensed insurer which contravenes subsection (1) shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $25,000 and, in the case of a continuing offence, to a further fine not exceeding $2,500 for every day or part of a day during which the offence continues after conviction. [19/2015] |
(7) In this section —“remuneration” includes —| (a) | any monetary commission, incentive, benefit or reward; | | (b) | any non-monetary incentive, benefit or reward; and | | (c) | such other consideration as prescribed under section 154 or specified by the Authority by written notice; |
|
| “supervisor”, in relation to a financial adviser, has the meaning given by section 2(1) of the Financial Advisers Act 2001. [26 [19/2015] |
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| Application and interpretation of sections 26 to 32 |
| 25.—(1) This section and sections 26 to 32 apply to, and in relation to, all individuals, whether resident in Singapore or not and whether citizens of Singapore or not, and to all bodies corporate or unincorporate, whether incorporated, formed, established or carrying on business in Singapore or not. [11/2013] (2) For the purposes of sections 26 to 32 —| (a) | a reference to the control of a percentage of the voting power in an insurer is a reference to the control, whether direct or indirect, of that percentage of the total number of votes that might be cast in a general meeting of the insurer; and | | (b) | any reference to “arrangement” includes a reference to any formal or informal scheme, arrangement or understanding, and any trust whether express or implied. [27 [11/2013] |
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| Control of take-overs of licensed insurers incorporated in Singapore |
| 26.—(1) A person must not, on or after 18 April 2013, obtain effective control of a licensed insurer incorporated in Singapore without the prior written approval of the Authority. [11/2013] (2) Subject to section 33A, the Authority may approve an application made by any person under subsection (1) if the Authority is satisfied that —| (a) | the person is a fit and proper person; and | | (b) | having regard to the likely influence of the person, the licensed insurer concerned will or will continue to conduct its business prudently and comply with the provisions of this Act. [11/2013] [Act 37 of 2024 wef 18/11/2024] |
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(3) Any approval under this section may be granted to any person subject to such conditions as the Authority may determine, including but not limited to any condition —| (a) | restricting the person’s disposal or further acquisition of shares or voting power in the licensed insurer concerned; or | | (b) | restricting the person’s exercise of voting power in the insurer. [11/2013] |
|
| (4) The Authority may at any time add to, vary or revoke any condition imposed under subsection (3). [11/2013] |
| (5) Any condition imposed under subsection (3) or (4) has effect despite any of the provisions of the Companies Act 1967 or anything contained in the memorandum or articles of association of the licensed insurer concerned. [11/2013] |
(6) Any person who contravenes subsection (1), or fails to comply with any condition imposed under subsection (3) or (4), shall be guilty of an offence and shall be liable on conviction —| (a) | in the case of an individual, to a fine not exceeding $125,000 or to imprisonment for a term not exceeding 3 years or to both and, in the case of a continuing offence, to a further fine not exceeding $12,500 for every day or part of a day during which the offence continues after conviction; or | | (b) | in any other case, to a fine not exceeding $250,000 and, in the case of a continuing offence, to a further fine not exceeding $25,000 for every day or part of a day during which the offence continues after conviction. [11/2013] |
|
(7) For the purposes of this section —| (a) | a person is, subject to paragraph (b), regarded as obtaining effective control of a licensed insurer if —| (i) | the person, whether alone or together with the person’s associates —| (A) | holds 20% or more of the total number of issued shares in the insurer; or | | (B) | is in a position to control 20% or more of the voting power in the insurer; |
| | (ii) | the directors of the insurer are accustomed or under an obligation, whether formal or informal, to act in accordance with the directions, instructions or wishes of the person (whether acting alone or together with any other person, and whether with or without holding shares or controlling voting power in the insurer); or | | (iii) | the person (whether acting alone or together with any other person, and whether with or without holding shares or controlling voting power in the insurer) is in a position to determine the policy of the insurer; |
| | (b) | a person is not regarded as obtaining effective control of a licensed insurer if —| (i) | the person is a director or any other officer of the insurer whose appointment has been approved by the Authority; or | | (ii) | the directors of the insurer are accustomed to act in accordance with the directions, instructions or wishes of the person by reason only that the directors act on advice given by the person in the person’s professional capacity; |
| | (c) | a person, A, is an associate of another person, B, if —| (i) | A is the spouse, or a parent, remoter lineal ancestor or step-parent, a son, daughter, remoter issue, stepson or stepdaughter, or a brother or sister of B; | | (ii) | A is a body corporate that is, or a majority of the directors of which are, accustomed or under an obligation whether formal or informal to act in accordance with the directions, instructions or wishes of B; | | (iii) | A is a person who is accustomed or under an obligation, whether formal or informal, to act in accordance with the directions, instructions or wishes of B; | | (iv) | A is a subsidiary of B; | | (v) | A is a body corporate in which B, alone or together with other associates of B as described in sub‑paragraphs (ii), (iii) and (iv), is in a position to control at least 20% of the voting power in A; or | | (vi) | A is a person with whom B has an agreement or arrangement, whether oral or in writing and whether express or implied, to act together with respect to the acquisition, holding or disposal of shares or other interests in, or with respect to the exercise of their voting power in relation to, an insurer; and |
| | (d) | a person holds a share if —| (i) | the person is deemed to have an interest in that share under section 7(6) of the Companies Act 1967; or | | (ii) | the person otherwise has a legal or an equitable interest in that share, except for such interest as is to be disregarded under section 7(7), (8) and (9) of the Companies Act 1967. [28 [11/2013; 35/2014] |
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| Control of substantial shareholdings of licensed insurers incorporated in Singapore |
| 27.—(1) A person must not, on or after 18 April 2013, become a substantial shareholder of a licensed insurer incorporated in Singapore without the prior written approval of the Authority. [11/2013] | (2) A person must not, on or after 18 April 2013, enter into any agreement or arrangement, whether oral or in writing and whether express or implied, to act together with any person with respect to the acquisition or holding of, or the exercise of rights in relation to, their interests in voting shares of an aggregate of 5% or more of the total votes attached to all voting shares in a licensed insurer which is incorporated in Singapore, without the prior written approval of the Authority. [11/2013] |
(3) Subject to section 33A, the Authority may approve an application made by any person under subsection (1) or (2) if the Authority is satisfied that —| (a) | the person is a fit and proper person; and | | (b) | having regard to the likely influence of the person, the licensed insurer concerned will or will continue to conduct its business prudently and comply with the provisions of this Act. [11/2013] [Act 37 of 2024 wef 18/11/2024] |
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(4) Any approval under this section may be granted to any person subject to such conditions as the Authority may determine, including but not limited to any condition —| (a) | restricting the person’s further acquisition of shares or voting power in the licensed insurer concerned; or | | (b) | restricting the person’s exercise of voting power in the insurer. [11/2013] |
|
| (5) The Authority may add to, vary or revoke any condition imposed under subsection (4). [11/2013] |
| (6) Any condition imposed under subsection (4) or (5) has effect despite any of the provisions of the Companies Act 1967 or anything contained in the memorandum or articles of association of the licensed insurer concerned. [11/2013] |
(7) Any person who contravenes subsection (1) or (2) shall be guilty of an offence and shall be liable on conviction —| (a) | in the case of an individual, to a fine not exceeding $125,000 and, in the case of a continuing offence, to a further fine not exceeding $12,500 for every day or part of a day during which the offence continues after conviction; or | | (b) | in any other case, to a fine not exceeding $250,000 and, in the case of a continuing offence, to a further fine not exceeding $25,000 for every day or part of a day during which the offence continues after conviction. [11/2013] |
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(8) Any person who fails to comply with any condition imposed under subsection (4) or (5) shall be guilty of an offence and shall be liable on conviction —| (a) | in the case of an individual, to a fine not exceeding $125,000 or to imprisonment for a term not exceeding 3 years or to both and, in the case of a continuing offence, to a further fine not exceeding $12,500 for every day or part of a day during which the offence continues after conviction; or | | (b) | in any other case, to a fine not exceeding $250,000 and, in the case of a continuing offence, to a further fine not exceeding $25,000 for every day or part of a day during which the offence continues after conviction. [11/2013] |
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(9) For the purposes of this section, a person holds, or has an interest in, a share if —| (a) | the person is deemed to have an interest in that share under section 7 of the Companies Act 1967; or | | (b) | the person otherwise has a legal or an equitable interest in that share except for such interest as is to be disregarded under section 7 of the Companies Act 1967. [29 [11/2013] |
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| Objection to existing control of licensed insurers incorporated in Singapore |
28.—(1) The Authority may serve a written notice of objection on any person referred to in section 26 or 27 if the Authority is satisfied that —| (a) | any condition of approval imposed on the person under section 26(3) or (4) or 27(4) or (5) has not been complied with; | | (b) | the person has provided any false or misleading information or document in connection with an application under section 26 or 27; | | (c) | the Authority would not have granted its approval under section 26 or 27 had it been aware, at that time, of circumstances relevant to the person’s application for such approval; | | (d) | the person has ceased to be a fit and proper person; or | | (e) | having regard to the likely influence of the person, the licensed insurer concerned is no longer likely to conduct its business prudently or to comply with the provisions of this Act. [11/2013] |
| (2) Before the service of a written notice of objection, the Authority must, unless the Authority decides that it is not practicable or desirable to do so, cause to be given to the person concerned a written notice of the Authority’s intention to serve the written notice of objection, specifying a date by which the person may make written representations with regard to the proposed written notice of objection. [11/2013] |
| (3) Upon receipt of any written representations, the Authority must consider them for the purpose of determining whether to issue a written notice of objection. [11/2013] |
(4) The Authority must, in any written notice of objection, specify a reasonable period within which the person to be served the written notice of objection must —| (a) | take such steps as are necessary to ensure that the person ceases to be in effective control as defined in section 26, or ceases to be a substantial shareholder or a party to the agreement or arrangement described in section 27(2), as the case may be; or | | (b) | comply with such direction or directions as the Authority may make under section 29. [11/2013] |
|
| (5) Any person served with a written notice of objection under this section must comply with the notice. [11/2013] |
(6) Any person who contravenes subsection (5) shall be guilty of an offence and shall be liable on conviction —| (a) | in the case of an individual, to a fine not exceeding $125,000 or to imprisonment for a term not exceeding 3 years or to both and, in the case of a continuing offence, to a further fine not exceeding $12,500 for every day or part of a day during which the offence continues after conviction; or | | (b) | in any other case, to a fine not exceeding $250,000 and, in the case of a continuing offence, to a further fine not exceeding $25,000 for every day or part of a day during which the offence continues after conviction. [29A [11/2013] |
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29.—(1) Without affecting section 28, if the Authority is satisfied that any person has contravened section 26, 27 or 28(5) or has failed to comply with any condition imposed under section 26(3) or (4) or 27(4) or (5), or if the Authority has served a written notice of objection under section 28, the Authority may, by written notice —| (a) | direct the transfer or disposal of all or any of the shares in the licensed insurer concerned held by the person or any of the person’s associates (called in this section the specified shares) within such time or subject to such conditions as the Authority considers appropriate; | | (b) | restrict the transfer or disposal of the specified shares; or | | (c) | make such other direction as the Authority considers appropriate. [11/2013] |
| (2) Any person to whom a notice is given under subsection (1) must comply with such direction or directions as may be specified in the notice. [11/2013] |
(3) In the case of any direction made under subsection (1)(a) or (b), until a transfer or disposal is effected in accordance with the direction or until the restriction on the transfer or disposal is removed (as the case may be) despite any of the provisions of the Companies Act 1967 or the Insolvency, Restructuring and Dissolution Act 2018 or anything contained in the memorandum or articles of association of the licensed insurer concerned —| (a) | no voting rights may be exercisable in respect of the specified shares unless the Authority expressly permits such rights to be exercised; | | (b) | no shares of the insurer may be issued or offered (whether by way of rights, bonus or otherwise) in respect of the specified shares unless the Authority expressly permits such issue or offer; and | | (c) | except in a liquidation of the insurer, no payment may be made by the insurer of any amount (whether by way of dividends or otherwise) in respect of the specified shares unless the Authority expressly authorises such payment. [11/2013; 40/2018] |
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(4) Any person who contravenes subsection (2) shall be guilty of an offence and shall be liable on conviction —| (a) | in the case of an individual, to a fine not exceeding $125,000 or to imprisonment for a term not exceeding 3 years or to both and, in the case of a continuing offence, to a further fine not exceeding $12,500 for every day or part of a day during which the offence continues after conviction; or | | (b) | in any other case, to a fine not exceeding $250,000 and, in the case of a continuing offence, to a further fine not exceeding $25,000 for every day or part of a day during which the offence continues after conviction. [29B [11/2013] |
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30.—(1) Where a person is charged with an offence in respect of a contravention of section 26 or 27, it is a defence for the person to prove that —| (a) | the person was not aware that the person had contravened section 26 or 27, as the case may be; and | | (b) | the person has, within 14 days after becoming aware that the person had contravened section 26 or 27 (as the case may be) notified the Authority of the contravention and, within such time as determined by the Authority, taken such actions in relation to the person’s control of the voting power or the person’s shareholding in the licensed insurer concerned as the Authority may direct. [11/2013] |
(2) Where a person is charged with an offence in respect of a contravention of section 26, it is also a defence for the person to prove that, even though the person was aware of the contravention —| (a) | the contravention occurred as a result of an increase in the shareholding as described in section 26(7)(d) of, or in the voting power controlled by, any of the person’s associates described in section 26(7)(c)(i); | | (b) | the person has no agreement or arrangement, whether oral or in writing and whether express or implied, with that associate with respect to the acquisition, holding or disposal of shares or other interests in, or under which they act together in exercising their voting power in relation to, the licensed insurer concerned; and | | (c) | the person has, within 14 days after the date of the contravention, notified the Authority of the contravention and, within such time as may be determined by the Authority, taken such action in relation to the person’s control of the voting power or the person’s shareholding in the licensed insurer concerned as the Authority may direct. [11/2013] |
|
| (3) Except as provided in subsections (1) and (2), it is not a defence for a person charged with an offence in respect of a contravention of section 26 or 27 to prove that the person did not intend to or did not knowingly contravene section 26 or 27, as the case may be. [29C [11/2013] |
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| 31. Any person who is aggrieved by a decision of the Authority under section 26, 27, 28 or 29 may, within 30 days after being informed of the decision of the Authority, appeal to the Minister in writing in accordance with Part 3B. [29D [11/2013] |
| Power of Authority to obtain information from licensed insurer, shareholder or other relevant persons |
32.—(1) The Authority may, by written notice, direct a licensed insurer that is incorporated in Singapore to obtain from any shareholder of the insurer, and to transmit to the Authority, information —| (a) | as to whether that shareholder holds any voting shares in the insurer as beneficial owner or as trustee; and | | (b) | if that shareholder holds those shares as trustee, indicating as far as that shareholder is able to provide the person or persons for whom that shareholder holds those shares (either by name or by other particulars sufficient to enable the person or persons to be identified) and the nature of the interests of the person or persons, |
| and the insurer must comply with that direction within such time as is specified in the notice. |
[11/2013] (2) The Authority may, by written notice, require any shareholder of a licensed insurer which is incorporated in Singapore, or any person (called in this subsection the relevant person) who appears from information provided to the Authority under subsection (1) or this subsection to have an interest in any share in a licensed insurer which is incorporated in Singapore, to provide to the Authority, within such time as may be specified in the notice or within such extended period of time as the Authority may allow, any information relating to the shareholder or the relevant person (as the case may be) which the Authority may require for the purpose of ascertaining or investigating into the control of shareholding or voting power in the insurer, or exercising any power or function under sections 26 to 30, including any information —| (a) | as to whether the shareholder holds any share, or the relevant person holds that interest, as beneficial owner or as trustee, and if the shareholder or relevant person holds that share or interest as trustee, indicating as far as the shareholder or relevant person can, the person for whom the shareholder or relevant person holds that share or interest (either by name or by other particulars sufficient to enable that person to be identified) and the nature of that person’s interest; or | | (b) | as to whether any share or any voting right attached to the share is the subject of an agreement or arrangement described in section 26(7)(c)(vi) or 27(2), and if so, giving particulars of the agreement or arrangement and the parties to it, |
| and the shareholder or the relevant person (as the case may be) must comply with that notice within such time as may be specified in the notice. |
[11/2013] |
(3) Any person who —| (a) | fails to comply with a notice under this section; or | | (b) | in purported compliance with the notice, knowingly or recklessly provides any information or document that is false or misleading in a material particular, |
| shall be guilty of an offence. |
[11/2013] |
(4) Any person convicted of an offence under subsection (3) shall be liable on conviction —| (a) | in the case of an individual, to a fine not exceeding $125,000 or to imprisonment for a term not exceeding 3 years or to both and, in the case of a continuing offence, to a further fine not exceeding $12,500 for every day or part of a day during which the offence continues after conviction; or | | (b) | in any other case, to a fine not exceeding $250,000 and, in the case of a continuing offence, to a further fine not exceeding $25,000 for every day or part of a day during which the offence continues after conviction. [11/2013] |
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| (5) Where a person claims, before providing the Authority with any information or document that the person is required to provide under subsection (2), that the information or document might tend to incriminate the person, the information or document is not admissible in evidence against the person in criminal proceedings other than proceedings under sections 26, 27, 28 and 29. [30 [11/2013] |
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| Application of sections 25 to 32 to licensed insurer that is co‑operative society |
| 33. Sections 25 to 32 apply, with the necessary modifications, to a licensed insurer that is a co‑operative society as if it were a licensed insurer incorporated in Singapore. [30A [11/2013] |
| Minister’s approval of section 26 or 27 application required where licensed insurer is co-operative society, etc. |
33A.—(1) This section applies to an application for an approval mentioned in section 26(1) or 27(1) or (2) (called in this section a relevant application), where —| (a) | the licensed insurer that is the subject of the application is a co-operative society; | | (b) | the licensed insurer that is the subject of the application has acquired at any time (but not earlier than 5 years before the date of commencement of the Insurance (Amendment) Act 2024) the principal business or undertaking of a co‑operative society; or | | (c) | a co-operative society is a substantial shareholder of, or has obtained effective control of, the licensed insurer that is the subject of the application. |
| (2) The Authority must not approve a relevant application except with the Minister’s approval. |
| (3) The Minister (called in this subsection the relevant Minister) may, after consulting the Minister charged with the responsibility for the Co‑operative Societies Act 1979, withhold his or her approval in subsection (2) if the relevant Minister considers that it is in the public interest to do so. |
| (4) Section 31 does not apply to the Authority not approving a relevant application on the basis that the Minister has withheld his or her approval in subsection (2). |
| (5) The Minister may, in giving his or her approval in subsection (2), impose such conditions as the Minister may determine. |
| (6) The Minister may at any time add to, vary or revoke any condition imposed under subsection (5). |
| (7) Any condition imposed under subsection (5) (including a condition added or varied under subsection (6)) has effect despite any written law or anything contained in the memorandum or articles of association or other constitutional document of the licensed insurer. |
(8) Any person who fails to comply with any condition imposed under subsection (5) (including a condition added or varied under subsection (6)) shall be guilty of an offence and shall be liable on conviction —| (a) | in the case of an individual, to a fine not exceeding $125,000 or to imprisonment for a term not exceeding 3 years or to both and, in the case of a continuing offence, to a further fine not exceeding $12,500 for every day or part of a day during which the offence continues after conviction; or | | (b) | in any other case, to a fine not exceeding $250,000 and, in the case of a continuing offence, to a further fine not exceeding $25,000 for every day or part of a day during which the offence continues after conviction. |
|
| (9) This section applies also to a relevant application received by the Authority before the date of commencement of the Insurance (Amendment) Act 2024, that is still pending as of that date. |
| (10) In subsection (1)(c), whether a co‑operative society has obtained effective control of a licensed insurer is to be determined in accordance with section 26(7). [Act 37 of 2024 wef 18/11/2024] |
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| Investment in corporations |
| 34.—(1) A licensed insurer which is established or incorporated in Singapore must not acquire or hold, directly or indirectly, a major stake in any corporation without the prior approval of the Authority. [11/2013] (2) A licensed insurer which is incorporated outside Singapore must not, without the prior approval of the Authority —| (a) | acquire, directly or indirectly, a major stake in any corporation using any of the assets of any insurance fund established and maintained by the licensed insurer under this Act; or | | (b) | hold, directly or indirectly, a major stake in any corporation as assets of any insurance fund established and maintained by the licensed insurer under this Act. [11/2013] |
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(3) Despite subsections (1) and (2) —| (a) | a licensed insurer who is a licensed insurer by virtue of section 68 of the Insurance (Amendment) Act 2013 may, during a period of 6 months after 18 April 2013 or such longer period as the Authority may allow in any particular case, without the prior written approval of the Authority —| (i) | if the insurer is one referred to in subsection (1), hold, directly or indirectly, a major stake in any corporation; or | | (ii) | if the insurer is one referred to in subsection (2), hold, directly or indirectly, a major stake in any corporation using any of the assets or as assets (as the case may be) of any insurance fund established and maintained by the licensed insurer under this Act, |
| if the acquisition of the major stake was made before 18 April 2013 and the insurer was not required by a condition of its registration under this Act in force immediately before that date to obtain the Authority’s approval to such acquisition or the holding of the major stake; but |
| | (b) | the licensed insurer must not continue to hold any major stake referred to in paragraph (a) after the period referred to in that paragraph unless it has obtained the approval of the Authority. [11/2013] |
|
| (4) Any approval granted by the Authority under this section for a licensed insurer to acquire or hold, directly or indirectly, a major stake in a corporation may be subject to such conditions as the Authority may determine, including any condition relating to the operations or activities of the corporation. [11/2013] |
| (5) The Authority may at any time add to, vary or revoke any condition imposed under subsection (4). [11/2013] |
(6) This section does not apply to —| (a) | any interest held by way of security for the purposes of a transaction entered into in the ordinary course of business of an insurer; | | (b) | any shareholding or interest acquired or held by an insurer in the course of satisfaction of debts due to it which is disposed of at the earliest suitable opportunity; and | | (c) | such other interest as may be prescribed. [11/2013] |
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(7) The Authority may, by regulations —| (a) | exclude the operation of this section in respect of any corporation or class of corporations, subject to such conditions as may be prescribed; | | (b) | provide for the manner of computation of major stakes; and | | (c) | provide that any interest or control referred to in the definition of “major stake” in subsection (9) that is acquired or held, directly or indirectly, by a corporation in which a licensed insurer has, directly or indirectly, a major stake, is deemed to be acquired or held by the insurer. [11/2013] |
|
| (8) Any licensed insurer which contravenes subsection (1) or (2), or fails to comply with any condition imposed or prescribed under this section, shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $250,000 and, in the case of a continuing offence, to a further fine not exceeding $25,000 for every day or part of a day during which the offence continues after conviction. [11/2013] |
(9) In this section, unless the context otherwise requires —| (a) | “major stake” means —| (i) | any beneficial interest exceeding 10% of the total number of issued shares (or, in the case of an umbrella VCC, either exceeding 10% of the total number of issued shares in the umbrella VCC that are not in respect of any of its sub-funds, or exceeding 10% of the total number of issued shares in the umbrella VCC in respect of any one of its sub-funds) or such other measure corresponding to shares in a corporation as may be prescribed; [S 26/2022 wef 13/01/2022] | | (ii) | control over more than 10% of the voting power (or, in the case of an umbrella VCC, either more than 10% of the voting power in the umbrella VCC that is not in respect of any of its sub-funds, or more than 10% of the voting power in the umbrella VCC in respect of any one of its sub-funds) or such other measure corresponding to voting power in a corporation as may be prescribed; or [S 26/2022 wef 13/01/2022] | | (iii) | any interest in a corporation, where the directors of the company or VCC are accustomed or under an obligation, whether formal or informal, to act in accordance with the directions, instructions or wishes of the licensed insurer concerned, or where the insurer is in a position to determine the policy of the corporation; [S 26/2022 wef 13/01/2022] |
| | (aa) | “sub-fund”, in relation to an umbrella VCC, has the meaning given by section 2(1) of the Variable Capital Companies Act 2018; [S 26/2022 wef 13/01/2022] | | (ab) | “umbrella VCC” and “VCC” have the meanings given by section 2(1) of the Variable Capital Companies Act 2018; and [S 26/2022 wef 13/01/2022] | | (b) | a reference to voting power in a corporation is a reference to the total number of votes that might be cast in a general meeting of the corporation or, in the case of an umbrella VCC, the total number of votes that might be cast in a general meeting of the umbrella VCC or a meeting of a class of members of the umbrella VCC holding shares in respect of any one of its sub‑funds. [11/2013] [S 26/2022 wef 13/01/2022] |
|
| (10) Any approval to acquire or hold a major stake in a corporation that was granted by the Authority before 18 April 2013 to an insurer pursuant to a condition of the insurer’s registration under this Act in force before that date is, if such approval remains in force immediately before that date, deemed to be an approval granted under this section. [30B [11/2013] |
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| Approval or removal of key executive person, chairperson or director of licensed insurer |
35.—(1) Subject to this section, a licensed insurer must have —| (a) | a chief executive; | | (b) | an appointed actuary, if the insurer is a direct insurer licensed to carry on life business; | | (c) | a certifying actuary, if the insurer is a direct insurer licensed to carry on general business, or a reinsurer licensed to carry on life or general business; and | | (d) | such other person holding an appointment, or persons holding appointments, in the licensed insurer as may be prescribed. [11/2013] |
| (2) Subject to this section, a licensed insurer which is established or incorporated in Singapore must have a chairperson appointed from among its directors. [11/2013] |
| (3) Subject to this section, a licensed insurer may appoint a person as its deputy chief executive. [11/2013] |
(4) A licensed insurer must not appoint a person as its key executive person unless —| (a) | the insurer has satisfied the Authority that the person is a fit and proper person to be so appointed; and | | (b) | the insurer has obtained the approval of the Authority to so appoint the person. [11/2013] |
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(5) A licensed insurer which is established or incorporated in Singapore must not appoint a person as its chairperson or director unless —| (a) | the insurer has satisfied the Authority that the person is a fit and proper person to be so appointed; and | | (b) | the insurer has obtained the approval of the Authority to so appoint the person. [11/2013] |
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(6) The Authority may —| (a) | grant its approval, with or without conditions —| (i) | to a licensed insurer to appoint a key executive person under subsection (4); or | | (ii) | to a licensed insurer which is established or incorporated in Singapore to appoint a person as its chairperson or director (as the case may be) under subsection (5); and |
| | (b) | at any time add to, vary or revoke any condition of approval referred to in paragraph (a) or impose any conditions thereto. [11/2013] |
|
| (7) Without limiting section 154, the Authority may prescribe the duties of the key executive persons of a licensed insurer, and the duties of the chairperson and directors of a licensed insurer which is established or incorporated in Singapore. [11/2013] |
| (8) Where a licensed insurer has obtained the approval of the Authority to appoint a person as its key executive person under subsection (4), the person may be re‑appointed in that office or appointment immediately upon the expiry of the earlier term without the approval of the Authority. [11/2013] |
| (9) Where a licensed insurer which is established or incorporated in Singapore has obtained the approval of the Authority to appoint a person as its chairperson or director under subsection (5), the licensed insurer must only appoint the person to hold such office or appointment for a term not exceeding such period as may be prescribed. [11/2013] |
(10) If at any time it appears to the Authority that —| (a) | a key executive person of a licensed insurer, or the chairperson or a director of a licensed insurer which is established or incorporated in Singapore, has failed to perform his or her functions or is no longer a fit and proper person to be so appointed; and | | (b) | it is necessary in the public interest or for the protection of policy owners of a licensed insurer, |
| the Authority may direct the licensed insurer to remove the key executive person, chairperson or director (as the case may be) from his or her office, appointment or employment. |
[11/2013] |
| (11) When determining, for the purpose of determining whether to grant its approval under subsection (4) or (5), or for the purposes of subsection (10)(a), whether a key executive person, chairperson or director has failed to perform his or her functions, the Authority must, without prejudice to any other matter it may consider relevant, have regard to such criteria as may be prescribed. [11/2013] |
(12) Before directing a licensed insurer to remove a person from his or her office, appointment or employment under subsection (10), the Authority must —| (a) | give the insurer and the person written notice of the Authority’s intention to do so; and | | (b) | in the notice referred to in paragraph (a), call upon the licensed insurer and the person to show cause within such time as may be specified in the notice why that person should not be removed. [11/2013] |
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(13) If the licensed insurer and the person referred to in subsection (12) —| (a) | fails to show cause within the time specified under subsection (12)(b) or within such extended period of time as the Authority may allow; or | | (b) | fails to show sufficient cause, |
| the Authority must give written notice to the insurer of the date on which the direction to remove the chairperson, director or key executive person (as the case may be) is to take effect. |
[11/2013] |
| (14) Any person who is aggrieved by a direction of the Authority under subsection (10) may, within 30 days after receiving the direction, appeal to the Minister in writing in accordance with Part 3B. [11/2013] |
| (15) Despite the lodging of an appeal under subsection (14), a direction to remove a licensed insurer’s key executive person, chairperson or director under subsection (10) continues to have effect pending the decision of the Minister. [11/2013] |
| (16) Any licensed insurer which contravenes subsection (1), (2), (4), (5) or (9), or fails to comply with any condition imposed by the Authority under subsection (6), shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $100,000 and, in the case of a continuing offence, to a further fine not exceeding $10,000 for every day or part of a day during which the offence continues after conviction. [11/2013] |
| (17) Any licensed insurer which fails to comply with any direction of the Authority under subsection (10) shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $250,000. [11/2013] |
| (18) Nothing in the Co-operative Societies Act 1979 or section 152 of the Companies Act 1967 prevents the Authority from exercising any power under subsection (10). [11/2013] |
| (19) No criminal or civil liability shall be incurred by a licensed insurer, or any person acting on behalf of the insurer, in respect of anything done or omitted to be done with reasonable care and in good faith in the discharge or purported discharge of the obligations of the insurer under this section. [11/2013] |
(20) In this section, unless the context otherwise requires —| “chairperson”, in relation to a licensed insurer, means the chairperson of the board of directors of the insurer; |
| “key executive person” means a person holding any appointment referred to in subsection (1)(a) to (d) or (3). [31 [11/2013] |
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| Disqualification of director or executive officer of licensed insurer |
36.—(1) Despite section 35 or the provisions of any other written law —| (a) | a licensed insurer must not, without the prior written consent of the Authority, permit a person to act as its executive officer; and | | (b) | a licensed insurer which is established or incorporated in Singapore must not, without the prior written consent of the Authority, permit a person to act as its director, |
| (c) | has been convicted, whether in Singapore or elsewhere, of an offence committed before, on or after 18 April 2013, being an offence —| (i) | involving fraud or dishonesty; | | (ii) | the conviction for which involved a finding that the person had acted fraudulently or dishonestly; or | | (iii) | specified in the Third Schedule to the Registration of Criminals Act 1949; |
| | (d) | is an undischarged bankrupt, whether in Singapore or elsewhere; | | (e) | has had an enforcement order against him or her in respect of a judgment debt returned unsatisfied in whole or in part; [Act 25 of 2021 wef 01/04/2022] | | (f) | has, whether in Singapore or elsewhere, entered into a compromise or scheme of arrangement with his or her creditors, being a compromise or scheme of arrangement that is still in operation; | | (g) | has had a prohibition order made against him or her that remains in force; or [Act 18 of 2022 wef 31/07/2024] | | (h) | has been a director of, or directly concerned in the management of, a regulated financial institution, whether in Singapore or elsewhere —| (i) | which is being or has been, wound up by a court; or | | (ii) | the licence of which has been revoked by the Authority or, in the case of a regulated financial institution in a foreign country, by the regulatory authority in that foreign country. [11/2013; 4/2017] |
|
| (2) Any licensed insurer which contravenes subsection (1) shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $250,000 and, in the case of a continuing offence, to a further fine not exceeding $25,000 for every day or part of a day during which the offence continues after conviction. [11/2013] |
(3) In this section, unless the context otherwise requires —“prohibition order” means —| (a) | a prohibition order made under section 68(1) of the Financial Advisers Act 2001 as in force immediately before the date of commencement of section 200(1)(b) and (2) to (7) of the Financial Services and Markets Act 2022; | | (b) | a prohibition order made under section 68(1) of the Financial Advisers Act 2001 as in force immediately before the date of commencement of section 200(1)(b) and (2) to (7) of the Financial Services and Markets Act 2022, and as continued by section 217(2) of the Financial Services and Markets Act 2022; | | (c) | an order made under section 74(1) as in force immediately before the date of commencement of section 204(1) to (4) of the Financial Services and Markets Act 2022; | | (d) | an order made under section 74(1) as in force immediately before the date of commencement of section 204(1) to (4) of the Financial Services and Markets Act 2022, and as continued by section 218(2) of the Financial Services and Markets Act 2022; | | (e) | a prohibition order made under section 101A(1) of the Securities and Futures Act 2001 as in force immediately before the date of commencement of section 209(1)(a), (c) and (d), (4) to (14), (17) and (18) of the Financial Services and Markets Act 2022; | | (f) | a prohibition order made under section 101A(1) of the Securities and Futures Act 2001 as in force immediately before the date of commencement of section 209(1)(a), (c) and (d), (4) to (14), (17) and (18) of the Financial Services and Markets Act 2022, and as continued by section 220(3) of the Financial Services and Markets Act 2022; | | (g) | a prohibition order made under section 123ZZC(1) of the Securities and Futures Act 2001 as in force immediately before the date of commencement of section 209(1)(a), (c) and (d), (4) to (14), (17) and (18) of the Financial Services and Markets Act 2022; | | (h) | a prohibition order made under section 123ZZC(1) of the Securities and Futures Act 2001 as in force immediately before the date of commencement of section 209(1)(a), (c) and (d), (4) to (14), (17) and (18) of the Financial Services and Markets Act 2022, and as continued by section 220(5) of the Financial Services and Markets Act 2022; or | | (i) | a prohibition order made under section 7(1) of the Financial Services and Markets Act 2022; [Act 18 of 2022 wef 31/07/2024] |
|
| “regulated financial institution” means a person who carries on a business, the conduct of which is regulated or authorised by the Authority or, if carried on in Singapore, would be regulated or authorised by the Authority; |
| “regulatory authority” has the meaning given by section 109. [31A [11/2013] |
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| Restriction on granting of unsecured loans or advances to directors and employees of insurers |
37.—(1) A licensed insurer must not in respect of its business in Singapore grant, directly or indirectly, unsecured loans or advances —| (a) | to a director of the insurer which in the aggregate and outstanding at any one time exceed the sum of $5,000; or | | (b) | to an employee of the insurer which in the aggregate and outstanding at any time exceed one year’s emolument of that employee. [11/2013] |
| (2) In this section, “director” includes the wife, husband, father, mother, son or daughter of a director. [32 |
|
| General obligation to provide information |
| 38.—(1) The Authority may, by written notice, require any Singapore insurer to provide it with information about any matter related to any business carried on by the insurer in Singapore or elsewhere if, in the opinion of the Authority, it requires that information for the discharge of its functions under this Act. [11/2013] | (2) A licensed insurer which is or was a PPF Scheme member as defined in the Deposit Insurance and Policy Owners’ Protection Schemes Act 2011, must provide to the PPF Agency, the Public Trustee appointed under the Public Trustee Act 1915 and any person authorised or appointed by the PPF Agency or the Public Trustee to perform its functions under the Deposit Insurance and Policy Owners’ Protection Schemes Act 2011, upon request, such information, including information relating to its policy owners, as may be required by the PPF Agency, the Public Trustee or such person to carry out the objects and to perform the functions of the PPF Agency or the Public Trustee (as the case may be) under that Act. [11/2013] |
| (3) Subsection (2) applies despite the cancellation of the licence of the insurer under section 13, whether wholly or in respect of a class of business. [33 [11/2013] |
|
| Licensed insurers to provide information for web aggregator |
| 39.—(1) Without limiting section 38, the Authority may, by regulations made under section 154 or written notice, require a licensed insurer or class of licensed insurers to provide to the Authority, or such person as may be specified in the regulations or notice (called in this section the specified person), such information as the Authority may require for the purposes of the web aggregator. [19/2015] | (2) For the purposes of subsection (1), the Authority may specify the time at which and the manner in which the information is to be provided in the regulations or notice. [19/2015] |
| (3) The Authority or specified person may prepare and publish any information provided under this section on the web aggregator. [19/2015] |
| (4) Any licensed insurer which fails to comply with any regulation or written notice referred to in subsection (1) shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $100,000 and, in the case of a continuing offence, to a further fine not exceeding $10,000 for every day or part of a day during which the offence continues after conviction. [19/2015] |
(5) Any licensed insurer which, in purported compliance with any regulation or written notice referred to in subsection (1), provides to the Authority or specified person any information which is false or misleading in a material particular shall be guilty of an offence and shall be liable on conviction —| (a) | in the case of an individual who committed the offence wilfully, to a fine not exceeding $125,000 or to imprisonment for a term not exceeding 3 years or to both; | | (b) | in the case of an individual who did not commit the offence wilfully, to a fine not exceeding $125,000; or | | (c) | in the case where the offence is committed by a person who is not an individual, to a fine not exceeding $250,000. [19/2015] |
|
| (6) In subsection (5), “licensed insurer” includes any person acting on behalf of the licensed insurer to carry out its obligation under the regulation or written notice. [19/2015] |
| (7) Any licensed insurer which fails to take reasonable care that any information provided to the Authority or specified person under this section is accurate shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $25,000. [19/2015] |
| (8) In this section and section 40, “web aggregator” means an Internet portal or domain on the Internet which the Authority, or such person as the Authority may appoint, creates, develops and operates for the purposes of publishing certain information from time to time, to assist any person in the purchase of a policy. [33A [19/2015] |
|
| Fees payable by licensed insurers for web aggregator |
40.—(1) Every licensed insurer must pay to the Authority such fees at such time and in such manner as may be prescribed for or in connection with all or any of the following:| (a) | the operation of the web aggregator; | | (b) | the development of the web aggregator; | | (c) | the maintenance of the web aggregator; | | (d) | the usage by the licensed insurer, or a class of licensed insurers to which the licensed insurer belongs, of the web aggregator. [19/2015] |
| (2) Subject to subsection (3), the Authority may prescribe different fees for different licensed insurers or classes of licensed insurers in connection with all or any of the matters referred to in subsection (1)(a) to (d), and any fees so prescribed need not bear any relationship to the costs of the services provided by the Authority in relation to the web aggregator. [19/2015] |
(3) The total fees payable by all the licensed insurers to the Authority under this section for any period of 12 months or a shorter period, must not exceed the costs incurred by the Authority in connection with all of the following in that period:| (a) | the operation of the web aggregator; | | (b) | the development of the web aggregator; | | (c) | the maintenance of the web aggregator; | | (d) | the usage by all the licensed insurers of the web aggregator. [19/2015] |
|
| (4) The Authority may, where the Authority considers appropriate in a particular case, waive, refund or remit the whole or any part of any fee paid or payable under subsection (1). [19/2015] |
| (5) Where a licensed insurer fails to pay the prescribed fees by the prescribed time, the Authority may impose a late payment fee of a prescribed amount for every day or part of a day that the payment is late, and both fees are recoverable by the Authority as a judgment debt. [33B [19/2015] |
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| Manufacture and offer of certain life policies |
| 41.—(1) If the Authority is of the opinion that it is in the public interest to do so, the Authority may direct a licensed insurer to manufacture and offer such type of life policy in Singapore as the Authority may prescribe or specify by written notice. [19/2015] (2) Without limiting subsection (1), the Authority may, in prescribing or specifying a type of life policy under subsection (1), prescribe or specify all or any of the following with respect to the life policy:| (a) | the time by which the life policy is to be manufactured and offered; | | (b) | the form and manner in which the life policy is to be manufactured or offered; | | (c) | the characteristics of the life policy; | | (d) | the terms of the life policy; | | (e) | the benefits to be or likely to be derived from the life policy; | | (f) | the manner of distribution or sale of the life policy. [19/2015] |
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| (3) Any licensed insurer which fails to comply with the direction under subsection (1) shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $100,000 and, in the case of a continuing offence, to a further fine not exceeding $10,000 for every day or part of a day during which the offence continues after conviction. [19/2015] |
(4) In this section, “manufacture”, in relation to a life policy, means —| (a) | the process of determining the appropriate premium rate or pricing for the life policy based on its product features and benefits; and | | (b) | such other processes in relation to the life policy as the Authority may prescribe. [33C [19/2015] |
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| Division 3 — Authorised reinsurers |
| Authorisation of reinsurers |
| 42.—(1) A person carrying on reinsurance business outside Singapore may apply to the Authority to be authorised for the purposes of this Act in such form and manner as the Authority may prescribe. [11/2013] | (2) The Authority may require the applicant to provide it with any information or document that the Authority considers necessary in relation to the application. [11/2013] |
| (3) The Authority may authorise the applicant with or without conditions, or refuse to authorise the applicant on any prescribed ground or on any other ground that the Authority thinks fit. [11/2013] |
| (4) The Authority may authorise the applicant as a general reinsurer or life reinsurer or both. [11/2013] |
| (5) The Authority must cause notice of any authorisation or change of name of a reinsurer authorised under this section to be published in the Gazette. [11/2013] |
| (6) Any applicant which is aggrieved by the refusal of the Authority to authorise it under this section may, within 30 days after being informed of the decision of the Authority, appeal to the Minister in writing in accordance with Part 3B. [11/2013] |
| (7) The Authority may at any time add to, vary or revoke any of the existing conditions of authorisation of a reinsurer or impose any conditions thereto. [11/2013] |
| (8) Any authorised reinsurer which fails to comply with any condition imposed by the Authority under subsection (3) or (7) shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $100,000 and, in the case of a continuing offence, to a further fine not exceeding $10,000 for every day or part of a day during which the offence continues after conviction. [34 [11/2013] |
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| Annual fees of authorised reinsurers |
| 43.—(1) Every authorised reinsurer must pay to the Authority such annual fees as may be prescribed. [11/2013] | (2) The Authority may prescribe different annual fees for different classes of reinsurance business or for different types of authorised reinsurers. [11/2013] |
| (3) The Authority may, where it considers appropriate in a particular case, waive, refund or remit the whole or any part of any annual fee paid or payable under subsection (1). [34A [11/2013] |
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| Withdrawal of authorisation |
| 44.—(1) The Authority may by order withdraw the authorisation of any reinsurer, either wholly or in respect of a class of business, at the request of the reinsurer or on any of the grounds set out in subsection (2). [11/2013] (2) The grounds referred to in subsection (1) are as follows:| (a) | the reinsurer has not commenced the business of providing reinsurance of liabilities under insurance policies to persons in Singapore within 12 months after being authorised; | | (b) | the reinsurer has ceased to carry on the business of providing reinsurance of liabilities under insurance policies to persons in Singapore whether wholly or in respect of any class of business; | | (c) | it appears to the Authority that the reinsurer has failed to satisfy an obligation to which the reinsurer is subject by virtue of this Act; | | (d) | the reinsurer proposes to make or has made, whether in Singapore or elsewhere, any composition or arrangement with its creditors, has gone into liquidation or has been wound up or otherwise dissolved; | | (e) | a receiver, a receiver and manager, a judicial manager, or any other person having the powers and duties of a receiver, a receiver and manager or a judicial manager, has been appointed, whether in Singapore or elsewhere, in relation to, or in respect of any property of, the reinsurer or any of the shareholders of the reinsurer having control of the reinsurer; | | (f) | there is a change of a person having control of the reinsurer, and —| (i) | the new person having control of the reinsurer is not a fit and proper person; or | | (ii) | the Authority is not satisfied as to the financial standing of the reinsurer after the change; |
| | (g) | the reinsurer is carrying on its business in a manner likely to be detrimental to the interests of its policy owners, whether in Singapore or elsewhere; | | (h) | the reinsurer is unable to meet its obligations, whether in Singapore or elsewhere; | | (i) | the reinsurer has contravened or is contravening — | (i) | any condition of its authorisation; | | (ii) | any direction given by the Authority under this Act; or | | (iii) | any provision of this Act; |
| | (j) | any of the officers of the reinsurer holding a managerial or executive position has been convicted of any offence under this Act committed before, on or after 18 April 2013; | | (k) | the reinsurer has provided false, misleading or inaccurate information, or has concealed or failed to disclose material facts, in its application for authorisation; | | (l) | the reinsurer has had its licence or authority to operate withdrawn by the supervisory authority which is responsible, under the laws of the foreign country where the reinsurer is incorporated, formed or established, for supervising the reinsurer; or | | (m) | it is in the public interest to withdraw the authorisation. [11/2013] |
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(3) Before withdrawing the authorisation of a reinsurer under subsection (1) other than at the request of the reinsurer, the Authority must —| (a) | give the reinsurer written notice of the Authority’s intention to do so; and | | (b) | in the notice referred to in paragraph (a), call on the reinsurer to show cause, within such time as may be specified in the notice, as to why the authorisation should not be withdrawn. [11/2013] |
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(4) If the reinsurer referred to in subsection (3) —| (a) | fails to show cause within the time specified under subsection (3)(b) or within such extended period of time as the Authority may allow; or | | (b) | fails to show sufficient cause, |
| the Authority must give written notice to the reinsurer of the date on which the withdrawal of authorisation is to take effect. |
[11/2013] |
| (5) An order to withdraw the authorisation of any reinsurer made under subsection (1) other than at the request of the reinsurer does not take effect until the expiration of a period of 30 days after the Authority has informed the reinsurer of the withdrawal under subsection (4). [11/2013] |
| (6) Any reinsurer which is aggrieved by a decision of the Authority under subsection (1) to withdraw the reinsurer’s authorisation other than at the reinsurer’s request may, within 30 days after the Authority has informed the reinsurer of the withdrawal under subsection (4), appeal to the Minister in writing in accordance with Part 3B. [11/2013] |
| (7) If, within the period referred to in subsection (6), the reinsurer concerned gives notice of appeal to the Minister, the order by the Authority to withdraw the authorisation of the reinsurer does not take effect unless the order is confirmed by the Minister or the appeal is for any reason dismissed by the Minister. [11/2013] |
(8) Despite the withdrawal of the authorisation of a reinsurer under subsection (1), so long as the reinsurer remains under any liability in respect of insurance policies belonging to the class of insurance business to which the authorisation relates, the reinsurer must take any action that it considers necessary or as required by the Authority to ensure that —| (a) | reasonable provision has been or will be made for that liability; and | | (b) | adequate arrangements exist or will exist for the payment of premiums and claims on those policies. [11/2013] |
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(9) For the purposes of this section —| (a) | a person is regarded as having control of a reinsurer if the person alone or together with any associate or associates —| (i) | holds 50% or more of the issued share capital (if any) of the reinsurer; or | | (ii) | is in a position to control 50% or more of the voting power in the reinsurer; |
| | (b) | a reference to voting power in a reinsurer is a reference to the total number of votes that might be cast in a general meeting of the reinsurer; and | | (c) | a person, A, is an associate of another person, B, if —| (i) | A is the spouse, or a parent, remoter lineal ancestor or step-parent, a son, daughter, remoter issue, stepson or stepdaughter, or a brother or sister, of B; | | (ii) | A is a body corporate that is, or a majority of the directors of which are, accustomed or under an obligation whether formal or informal to act in accordance with the directions, instructions or wishes of B; | | (iii) | A is a person who is accustomed or under an obligation, whether formal or informal, to act in accordance with the directions, instructions or wishes of B; | | (iv) | A is a subsidiary of B; | | (v) | A is a body corporate in which B, alone or together with other associates of B as described in sub‑paragraphs (ii), (iii) and (iv), is in a position to control at least 20% of the voting power in A; or | | (vi) | A is a person with whom B has an agreement or arrangement, whether oral or in writing and whether express or implied, to act together with respect to the acquisition, holding or disposal of shares or other interests in, or with respect to the exercise of their voting power in relation to, the reinsurer. [34B [11/2013; 35/2014] |
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| Effects of withdrawal of authorisation |
45.—(1) Where an order of withdrawal of the authorisation of a reinsurer under section 44 becomes effective —| (a) | the Authority must publish a notice of the withdrawal in the Gazette; and | | (b) | the reinsurer must, as from the date of withdrawal, cease to carry on the business of providing reinsurance of liabilities under insurance policies to persons in Singapore wholly or of the class in respect of which its authorisation has been withdrawn, as the case may be. [11/2013] |
(2) Subsection (1)(b) does not prejudice —| (a) | the enforcement by any policy owner or person of any right or claim against the reinsurer or by the reinsurer of any right or claim against any policy owner or person; and | | (b) | the collection or receipt of premiums on insurance policies effected before the date of withdrawal of the authorisation and belonging to the class of insurance business in respect of which the authorisation has been withdrawn, |
| and section 4 does not apply to the reinsurer in respect of the collection or receipt of the premiums referred to in paragraph (b). |
[34C [11/2013] |
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| Deposits by authorised reinsurers |
| 46.—(1) Every authorised reinsurer must maintain a reinsurance deposit of a value of such amount as the Authority may prescribe for the purposes of this section in respect of each class of business for which it is authorised. [11/2013] | (2) A deposit under subsection (1) must be made in such form and manner, and in assets of such nature, as may be prescribed or specified in directions by the Authority for the purposes of this section. [11/2013] |
| (3) All income accruing in respect of a deposit under subsection (1) is payable to the authorised reinsurer making the deposit. [11/2013] |
(4) The Authority may, in relation to a deposit under subsection (1), prescribe —| (a) | the rights and obligations of any party in relation to the deposit; and | | (b) | any other matter which the Authority considers to be incidental to or necessary for this section. [34D [11/2013] |
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| Bank covenants in lieu of deposits |
47.—(1) If, in the case of any authorised reinsurer, a bank licensed under any written law for the time being in force relating to banking makes with the Authority an agreement in a form approved by the Authority whereby —| (a) | the bank covenants to deposit with the Authority a specified sum in cash on account of the reinsurer’s deposit under section 46(1); and | | (b) | the covenant complies with any requirement the Authority sees fit to impose as to the circumstances in which that sum is to be deposited, |
| then, for the purposes of this Act, the reinsurer is treated as having made the deposit under that section and the sum so covenanted for is recoverable even if no consideration is provided on the agreement. |
[11/2013] | (2) Any sum deposited by a bank pursuant to an agreement made under subsection (1) is to be dealt with under or for the purposes of this Act as if it were a sum deposited by the authorised reinsurer under section 46. [34E [11/2013] |
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| Maintenance of assets by authorised reinsurers |
| 48.—(1) The Authority may, from time to time, by written notice to any authorised reinsurer, or any class of authorised reinsurers, direct the reinsurer or class of reinsurers (as the case may be) each to maintain and hold such minimum amount or amounts of assets in Singapore as may be specified in the notice for the purpose of meeting its liabilities. [11/2013] (2) Without limiting subsection (1), the Authority may, in a notice issued under that subsection, specify —| (a) | the types of liabilities in respect of which assets are to be maintained and held in Singapore; | | (b) | the types of assets that are to be treated as assets maintained and held in Singapore, and the minimum amount or amounts in respect of each asset for the purpose of any requirement of the Authority under that subsection; and | | (c) | the method for the valuation of assets maintained and held in Singapore, including any deduction to be made in respect of the assets. [11/2013] |
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| (3) Where the Authority issues a notice under subsection (1) to a class of authorised reinsurers, the Authority may direct different reinsurers within the class of reinsurers to maintain and hold different minimum amounts of assets in Singapore, having regard to the financial soundness of each reinsurer, the risk profile of each reinsurer and such other factors as the Authority may consider relevant. [11/2013] |
| (4) Any authorised reinsurer which fails to comply with any direction of the Authority under subsection (1) shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $250,000 and, in the case of a continuing offence, to a further fine not exceeding $25,000 for every day or part of a day during which the offence continues after conviction. [34F [11/2013] |
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| Custody of assets of authorised reinsurers |
| 49.—(1) The Authority may, in the case of an authorised reinsurer on which a requirement has been imposed under section 48, impose an additional requirement that the whole or a specified proportion of the assets to which the requirement under that section applies must be held by a person approved by the Authority for the purposes of the requirement under this section as trustee for the reinsurer. [11/2013] (2) Assets of an authorised reinsurer held by a person as trustee for the reinsurer are taken to be held by the person in compliance with a requirement imposed under this section if, and only if —| (a) | they are assets which the reinsurer has given the person written notice are to be held by the person in compliance with such a requirement; or | | (b) | they are assets into which assets which the reinsurer has given the person such written notice have, by any transaction or series of transactions, been transposed by the person on the instructions of the reinsurer. [11/2013] |
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| (3) No assets held by a person as trustee for an authorised reinsurer in compliance with a requirement imposed under this section may, so long as the requirement is in force, be released except with the written consent of the Authority. [11/2013] |
| (4) If a mortgage or charge is created by an authorised reinsurer at a time when there is in force a requirement imposed on the reinsurer by virtue of this section, being a mortgage or charge conferring a security on any assets which are held by a person as trustee for the reinsurer in compliance with the requirement, the mortgage or charge is, to the extent that it confers such a security, void against the liquidator and any creditor of the reinsurer. [34G [11/2013] |
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| General obligation of authorised reinsurers to provide information |
| 50. The Authority may, by written notice, require any authorised reinsurer to provide it with information about any matter related to any insurance business in respect of which the reinsurer is authorised if the Authority is of the opinion that it requires that information for the discharge of its functions under this Act. [34H [11/2013] |
| Saving for validity of policies |
| 51. Nothing in this Part, Part 2A or 2B invalidates any policy or contract of insurance. [35 |
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