Insurance Act
(CHAPTER 142)

(Original Enactment: Act 46 of 1966)

[1st January 1967]
Division 2 — Licensed insurers
[Act 11 of 2013 wef 18/04/2013]
Licensing of insurers
8.—(1)  A person who desires to carry on insurance business in Singapore as an insurer shall —
(a)apply in writing to the Authority for a licence under this section; and
(b)furnish such information as the Authority may require.
(2)  Upon receiving an application under subsection (1), the Authority shall consider the application and may grant a licence to the applicant with or without conditions or refuse to grant a licence.
(3)  The Authority shall 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.
(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.
(5)  The Authority may license an insurer as a direct insurer, reinsurer or captive insurer.
(6)  The Authority shall cause notice of the grant of any licence or change of name of a licensed insurer to be published in the Gazette.
(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 IIIB.
(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.
(9)  A licensed insurer shall, at all times during the currency of its licence, satisfy such financial requirements as may be prescribed under subsection (3)(b).
(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 thereof during which the offence continues after conviction.
(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 thereof during which the offence continues after conviction.
[Act 11 of 2013 wef 18/04/2013]
8A.  [Repealed by Act 11 of 2013 wef 18/04/2013]
9.  [Repealed by Act 11 of 2013 wef 18/04/2013]
10.  [Repealed by Act 11 of 2013 wef 18/04/2013]
Annual fees of licensed insurers
11.—(1)  Every licensed insurer shall pay to the Authority such annual fees as may be prescribed.
[11/86]
[Act 11 of 2013 wef 18/04/2013]
(2)  The Authority may prescribe different annual fees for different classes of insurance business or for different types of licensed insurers.
[11/86]
[Act 11 of 2013 wef 18/04/2013]
(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).
[Act 11 of 2013 wef 18/04/2013]
Cancellation of licence
12.—(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).
(2)  The Authority may impose such conditions as 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.
(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 8(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 the date of commencement of section 13 of the Insurance (Amendment) Act 2013;
(m)the insurer has furnished 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 (Cap. 77B) 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.
(4)  Before cancelling the licence of an insurer under subsection (1) other than at the request of the insurer, the Authority shall —
(a)give the insurer notice in writing 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.
(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 shall give notice in writing to the insurer of the date on which the cancellation of the licence is to take effect.
(6)  An order to cancel the licence of any insurer made under subsection (1) other than at the request of the insurer shall 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).
(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 IIIB.
(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 shall not take effect unless the order is confirmed by the Minister or the appeal is for any reason dismissed by the Minister.
(9)  Notwithstanding 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 shall take such action as it considers necessary or as may be 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.
(10)  For the purposes of this section —
(a)a person shall be 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, step-son or step-daughter, or a brother or sister of B;
(ii)A is a corporation whose directors are accustomed or under an obligation, whether formal or informal, to act in accordance with the directions, instructions or wishes of B or, where B is a corporation, of the directors of B;
(iii)B is a corporation whose directors are accustomed or under an obligation, whether formal or informal, to act in accordance with the directions, instructions or wishes of A or, where A is a corporation, of the directors of A;
(iv)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;
(v)B 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 A;
(vi)A is a related corporation of B;
(vii)A is a corporation in which B, alone or together with other associates of B as described in sub-paragraphs (ii) to (vi), is in a position to control not less than 20% of the voting power in A;
(viii)B is a corporation in which A, alone or together with other associates of A as described in sub-paragraphs (ii) to (vi), is in a position to control not less than 20% of the voting power in B; or
(ix)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)he is deemed to have an interest in that share under section 7(6) of the Companies Act (Cap. 50); or
(ii)he 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.
[Act 11 of 2013 wef 18/04/2013]
12A.  [Repealed by Act 11 of 2013 wef 18/04/2013]
Effects of cancellation of licence
13.—(1)  Where an order of cancellation of the licence of an insurer under section 12 becomes effective —
(a)the Authority shall publish a notice of the cancellation in the Gazette; and
(b)the insurer shall, 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.
(2)  Subsection (1)(b) shall 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 3 shall not apply to the insurer in respect of the collection or receipt of the premiums referred to in paragraph (b).
(3)  Notwithstanding the cancellation of the licence of an insurer, sections 36 and 37 shall, 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.
[Act 11 of 2013 wef 18/04/2013]