Guidance Note on Notifications to the Commission (January 2025)

Summary

This guidance note from the Guernsey Financial Services Commission (GFSC) sets out which routine matters licensed insurers and related parties must still notify to the Commission under the Insurance Business (Bailiwick of Guernsey) Law, 2002, and which no longer require Commission approval or acknowledgement. It reflects the Commission's move to an impact and risk based supervisory approach and aims to cut administrative back and forth on non-approval matters.

• Change of auditor: No Commission approval needed; insurers and auditors must ensure they meet sections 34 and 83 requirements themselves, and notifications will not routinely be acknowledged.
• Change of year end: Must be notified to the Commission (to update records) but does not require approval; licensees must also comply with Company Law on changes to financial periods.
• Dividends: Payment or declaration of a dividend does not require notification or approval unless a specific licence condition says otherwise, but must not breach section 31 of the Law.
• Change of business plan: A material change of business plan must be notified to the Commission before it is implemented; insurers need not wait for approval before proceeding. Guidance is given on what counts as material for captives, commercial insurers, commercial reinsurers, life insurers and life reinsurers.
• Custodian appointments: Do not require Commission approval, only notification via the business plan; the insurer must ensure custodians are independent of the insurer and insurance manager.
• Alternate directors: A pre approved director/alternate may act as alternate for a one off board meeting without prior approval (subject to a subsequent Online Application), but appointment of a permanent alternate director still requires prior Commission approval.
• PQs for PCC cells: A Personal Questionnaire is required for any individual owning, alone or with associates, 15% or more of a cell's shares; general overseers or day to day controllers designated by the insurance manager are exempt.
• Significant shareholding notifications: Corporate licensees must notify the Commission under section 49 of the Law of acquisitions of between 5% and 15% of voting power in the licensee; this does not apply to cells.
• Narrative business plans: Must follow the Insurance Business Rules, 2021 content requirements (nature of risks, exposures, reinsurance programme, fronting arrangements for general business) and must be resubmitted in full with each annual return; stating there is no change is not acceptable.

Licensees remain fully responsible for legal compliance and for the accuracy of anything they submit; the Commission's silence on a notification should not be read as approval of its legal basis.

Key obligations

• Licensed insurers and auditors must independently ensure compliance with sections 34 and 83 of the Law regarding auditor appointment and resignation, without relying on Commission chasing or acknowledgement.
• Licensees must notify the Commission of a change of year end so records can be updated, and must comply with Company Law requirements on changes to financial periods.
• Licensees must not declare or pay dividends in breach of section 31 of the Law.
• A material change of business plan must be notified to the Commission prior to its implementation.
• Captive insurers are expected to file an updated business plan annually with their annual return rather than submitting ad hoc notifications.
• Insurers must notify the custodians they intend to use in their business plan and ensure those custodians are independent of the insurer and insurance manager.
• Permanent alternate director appointments require prior Commission approval; one off alternate director use requires a subsequent Online Application to the Authorisations Unit.
• A completed Personal Questionnaire must be submitted for any individual owning, alone or with associates, 15% or more of the shares of a cell.
• Corporate licensees must notify the Commission under section 49 of the Law when a person acquires between 5% and 15% of the voting power of the licensee (cells excepted).
• Narrative business plans must be submitted in full, addressing the content requirements of the Insurance Business Rules 2021, with every annual return; simply stating no change is not acceptable.
• Licensees must have appropriate procedures for checking the accuracy of any submission made to the Commission.

Applies to

licensed insurers, insurance managers, auditors of licensed insurers, captive insurers, commercial insurers, commercial reinsurers, long-term (life) insurers, life reinsurers, licensees that are companies, protected cell companies (PCCs) and their cells

Deadlines

• prior to implementation: A material change of business plan must be notified to the Commission before it is implemented.
• annually, with the annual return: Captive insurers are expected to file an updated business plan annually alongside their annual return.
• with each annual return: The narrative business plan must be resubmitted in full with every annual return; a statement of no change is not acceptable.