Determination of liabilities in connection with winding up
25.—(1)  In proceedings under any written law relating to companies for a winding up by the court of an insurer to which this regulation applies, the contingent and prospective liabilities of the insurer in respect of policies shall, in determining whether the insurer is unable to pay its debts, be estimated as follows:
(a)liabilities in respect of policies belonging to the insurer’s life business shall in the case of life policies be valued on the minimum basis, and in other cases on the basis adopted for the last statutory valuation relating to that business; and
(b)subject to paragraph (7), liabilities in respect of policies belonging to the insurer’s general business shall be taken to be of an amount equal to the reserves for unexpired risks on those policies calculated in the manner prescribed under regulation 20(3).
(2)  Where, in any winding up of such an insurer, any liabilities of the insurer in respect of Singapore policies or offshore policies are required to be valued, the liabilities shall be estimated as follows:
(a)liabilities in respect of policies belonging to the insurer’s life business shall be valued on the basis adopted by the insurer on the last statutory valuation or, if there has been no such valuation, on the minimum basis; and
(b)liabilities in respect of any policy belonging to the insurer’s general business shall be taken to be of an amount equal to the reserves for unexpired risks on that policy calculated in the manner prescribed under regulation 20(3).
(3)  As regards life policies, paragraph (2) shall have effect subject to the following provisions:
(a)the addition (if any) to the liabilities in respect of any policy which is attributable to the adoption of a basis other than the minimum basis shall not rank for the purpose of proof against the assets of the life fund, except after payment in full of the liabilities and expenses to which the fund is applicable according to a valuation made on the minimum basis; and
(b)if there is an available surplus in the life fund, the liabilities in respect of participating policies shall, subject to paragraph (4), be increased so as to allocate to those policies such part of the surplus as is proportionate to the bonuses of the 10 years preceding the commencement of the winding up.
(4)  For the purposes of paragraph (3)(b), the part of the surplus proportionate to the bonuses of the said 10 years is the proportion which the amounts allocated out of surpluses in those 10 years by way of bonus to participating policies bear to the total of the amounts so allocated and of the amounts withdrawn from the fund in those years out of surpluses; but if it appears to the court that by reason of special circumstances an increase which would otherwise be made under paragraph (3)(b) in the liabilities in respect of any policy would be inequitable, the court may order that there shall be no increase or a lesser increase.
(5)  For the purposes of paragraph (3), “life fund” means an insurance fund maintained under the Act in respect of the insurer’s life business, including assets comprised in the deposit so maintained which do not form part of the fund except in a winding up and after allocation of such assets to the fund by the Authority under section 17(13) of the Act.
[S 466/2002 wef 01/10/2002]
(6)  For the purposes of paragraph (3)(b), there is an available surplus in the life fund if, but only if, after taking account of sums recovered from reinsurers, the fund is more than sufficient without recourse to the said assets to meet the liabilities and expenses to which it is applicable.
(7)  Where an insurer’s liabilities in respect of policies belonging to the insurer’s general business include the making of periodical payments in respect of an event occurring before the date as at which the liabilities are to be estimated under paragraph (1) or (2), then to the amount so determined there shall be added in respect of those payments such amount as would be taken to be their value for purposes of proof in winding up to which this regulation does not apply.
(8)  This regulation shall apply to any registered insurer and to any Singapore insurer which has ceased to be so registered but remains under any liability in respect of Singapore policies or offshore policies.