Insurance Business (Jersey) Law 1996

Summary

This is the principal Jersey law governing the authorization and supervision of insurance business. It establishes a permit regime administered by the Jersey Financial Services Commission (JFSC), sets out ongoing regulatory obligations for permit holders (accounting, auditing, solvency, governance), gives the Commission investigation, direction, intervention and public statement powers, and creates offences for carrying on unauthorized insurance business or supplying misleading information.

• Authorization: No person may carry on long-term or general insurance business in or from within Jersey without a Category A permit (for entities already authorized and supervised in an outside jurisdiction) or a Category B permit (all other cases) granted under Article 7.
• Applications: Applicants must apply in the Commission's required form, supply particulars and verification as required, pay the prescribed fee, and notify the Commission of any material change affecting the application while it is pending.
• Ongoing governance: Category B permit holders must obtain Commission approval for directors, chief executives and shareholder controllers, maintain solvency margins, and appoint an actuary where long-term business is carried on.
• Accounting and audit: Permit holders must keep accounting records, prepare annual financial statements, appoint qualified auditors, and ensure auditors submit reports to the Commission and communicate certain matters directly to the Commission.
• Display and disclosure: Permit holders must display their permit and any conditions; the law restricts disclosure of information obtained under the Law except in specified permitted circumstances, including co-operation with overseas supervisory authorities.
• Commission powers: The Commission may require information and documents, conduct or authorize investigations, enter and search premises, issue directions, exercise powers of intervention, seek injunctions or remedial orders, and issue public statements about permit holders.
• Offences: Carrying on insurance business without authorization is an offence punishable by up to 5 years' imprisonment or a fine, or both; providing false or misleading information to induce insurance contracts or to the Commission is also an offence.

The Law applies across the life of a permit holder's authorization, from initial application through ongoing supervision, transfers of insurance business, and potential cancellation, direction or public statement action by the Commission.

Key obligations

• No person may carry on long-term or general insurance business in or from within Jersey without a Category A or Category B permit granted under Article 7.
• Applicants for a permit must apply in the Commission's required form, provide required particulars and verification, and pay the prescribed fee.
• An applicant must give the Commission prompt written notice of any material alteration or event affecting information supplied in a pending application.
• Permit holders must display their permit and any conditions attached to it.
• Permit holders must keep proper accounting records and prepare annual financial statements.
• Permit holders must appoint a qualified auditor, and the auditor's report must be submitted to the Commission.
• Category B permit holders must obtain Commission approval for directors, chief executives and shareholder controllers.
• Category B permit holders must maintain solvency margins and, where long-term business is carried on, appoint an actuary.
• Permit holders and associated persons must comply with directions issued by the Commission under Article 36.
• Restrictions on disclosure of confidential information obtained under the Law must be observed, subject to specified permitted disclosures.
• It is an offence to carry on insurance business in Jersey without the required permit.
• It is an offence to make false or misleading statements to induce persons to enter insurance contracts or to provide false information to the Commission.

Applies to

insurance companies, Category A permit holders, Category B permit holders, permit applicants, auditors, actuaries, compliance officers, money laundering compliance officers, money laundering reporting officers, directors and shareholder controllers of permit holders

Related documents

• Insurance Business (Appointment of Manager) (Jersey) Order 2008 is made under this document
• Insurance Business (Solvency Margin) (Jersey) Order 1996 is made under this document
• Insurance Business Code of Practice is made under this document
• Insurance Business (General Provisions) (Jersey) Order 1996 is made under this document