Segregated Portfolio Companies (Insurance) Regulations, 2018

Summary

These Regulations, made under the BVI Business Companies Act, 2004, set out the framework for segregated portfolio companies (SPCs) operating as BVI insurers. They govern how a company applies to incorporate or register as a BVI insurer SPC, how segregated portfolios are created, terminated and reinstated, and the fees and administrative penalties that apply throughout the SPC's life cycle.

• Formation: A person wishing to incorporate or register a company as a BVI insurer segregated portfolio company must apply to the Commission in the approved form, providing the company's name, insurance manager details, and a list of proposed initial segregated portfolios, plus supporting statements and declarations of solvency and notice to policyholders.
• Insurance manager and audit: A BVI insurer SPC must at all times have an insurance manager, and must have an auditor to audit its financial statements (though the Commission may exempt certain audit or reporting requirements for specific portfolios).
• Solvency: Each segregated portfolio must maintain a minimum solvency margin under Division 1 of Part IV and Schedule 5 of the Regulatory Code, though no contributed capital is required for a portfolio itself.
• Creating, terminating and reinstating portfolios: A BVI insurer SPC needs prior written Commission approval to create a segregated portfolio; termination requires written notification meeting specified conditions (including a minimum 7 day notice period); reinstated portfolios and related terminations trigger further notification duties to the Commission or, for court-ordered reinstatements, provision of the court order.
• Names and information changes: The Commission can direct a name change for a misleading or undesirable portfolio name (with at least 21 days to comply), and SPCs must notify the Commission of changes to previously submitted information within 14 days.
• Fees and penalties: The Schedule sets application, initial and annual fees (varying for Category C licence holders), including an annual fee due on or before 28 February each year, and late payment penalties for missed notifications or fee payments.

Failure to comply with several notification and name change requirements exposes the segregated portfolio company, or in some cases a creditor or other person, to an administrative penalty imposed by the Commission under the Financial Services (Administrative Penalties) Regulations.

Key obligations

• Submit an application in the approved form to the Commission to incorporate or register a company as a BVI insurer SPC, including the company name, insurance manager details and a list of initial segregated portfolios
• Ensure the SPC has an insurance manager at all times and an auditor to audit its financial statements
• Maintain a minimum solvency margin for each segregated portfolio in accordance with the Regulatory Code
• Obtain prior written approval from the Commission before creating any segregated portfolio
• Notify the Commission in writing to terminate a segregated portfolio, with termination not taking effect earlier than 7 days after the Commission receives the notification
• Notify the Commission within 14 days of reinstating a segregated portfolio and pay the requisite fee
• Where a court orders reinstatement, provide the Commission a copy of the order within 7 days of the order being made
• Notify the Commission within 7 days of the termination of a reinstated segregated portfolio
• Comply with any Commission notice directing a change of a segregated portfolio's name within the period specified (not less than 21 days)
• Notify the Commission of any change in previously submitted information within 14 days of the change
• Pay application, initial and annual fees as set out in the Schedule, including the annual fee on or before 28 February each year

Applies to

BVI insurers, segregated portfolio companies (BVI insurer SPCs), insurance managers, Category C licence holders, creditors or other persons seeking reinstatement of a segregated portfolio

Deadlines

• not earlier than 7 days after the Commission receives notification of termination: Minimum period before termination of a segregated portfolio can take effect
• within 7 days of the termination: Notify the Commission when a reinstated segregated portfolio's reinstatement terminates
• within 14 days of the date of reinstatement: Notify the Commission in writing of reinstatement of a segregated portfolio and pay the requisite fee
• within 7 days of the making of the order: Creditor or other person must provide the Commission a copy of a court order reinstating a segregated portfolio
• not less than 21 days after the date of the notice: Minimum period to comply with a Commission notice to change a misleading or undesirable segregated portfolio name
• within 14 days of the date that the information changed: Notify the Commission of any change in information submitted under the Regulations
• on or before 28th February of each year: Annual fee payment due for a BVI insurer SPC, commencing in the year following incorporation or registration
• on or before 30 June / on or after 1 July in any year: Threshold dates determining the initial incorporation or portfolio-creation fee amounts payable