Consultation Paper No.5 2019: Insurance Business Fees

Summary

This is a JFSC consultation paper proposing changes to the fees payable under the Insurance Business (Jersey) Law 1996. It sets out a proposed 11.2% increase in insurance business fee rates and includes a draft Insurance Business Fees Notice (Appendix B) that would take effect if adopted. It applies to anyone applying for, or already holding, a permit to carry on insurance business in Jersey.

• Fee increase rationale: The proposed 11.2% rise comprises 2.8% for RPI inflation, 3.4% to fund enhanced financial crime supervision work, and 5% for reserve restoration, data analytics investment and the final tranche of a previously announced 15% real-terms fee increase since 2015.
• Additional optional increase: The JFSC also invites comment on a further 1.5% increase across the board to fund a dedicated insurance policy development resource.
• Draft Fees Notice contents: Sets out application fees (Schedule 1), annual fees (Schedule 2), registration change fees, a transfer of insurance business fee, and late payment/late filing fee mechanisms, with a proposed commencement date of 1 October 2019.
• Consultation process: Comments on the proposed fee rates are invited, to be sent to Jersey Finance Limited or directly to the JFSC by 27 September 2019, after which the JFSC intends to publish feedback and a final fees notice in Q3 2019.

As a consultation paper, this document does not itself impose binding obligations; it proposes a draft fees regime that, if finalised, would apply from 1 October 2019 and would be administered through firms' myJFSC portal accounts.

Key obligations

• Under the draft Fees Notice, a permit holder would be required to pay an annual fee due on 1 October each year, with the due date for payment being 31 October of the same year
• Applicants for a permit to carry on insurance business would be required to pay an application fee as set out in Schedule 1 of the draft notice
• A permit holder changing registration between a limited company/limited liability partnership and a cell company or cell would be required to pay a registration change fee (£1,860 or £1,770 depending on direction)
• A permit holder undergoing a transfer of insurance business would be required to pay a £5,840 fee at the time of submitting draft transfer documentation, in advance of the Direction Hearing
• If the annual fee is not paid by the due date, a late payment fee of 5% of the unpaid principal would be applied on the day after the due date and on the first day of each subsequent month
• If a permit holder fails to file or deliver a required document by its due date, a late filing fee of £100 per complete month or part thereof would apply unless the JFSC has agreed in writing to a later date
• Interested parties wishing to comment on the proposed fee increase should submit responses to Jersey Finance Limited or the JFSC by 27 September 2019

Applies to

insurance business permit holders, applicants for a permit to carry on insurance business, cell companies and cells carrying on insurance business, limited liability partnerships carrying on insurance business

Deadlines

• 27 September 2019: Deadline for submitting consultation responses to Jersey Finance Limited or the JFSC
• 1 October 2019: Proposed commencement/effective date of the new fees set out in the draft Insurance Business Fees Notice
• 1 October of each year (annual fee), due by 31 October: Proposed date on which the annual fee becomes payable by permit holders, with 31 October as the due date, under the draft Fees Notice
• Third quarter of 2019: JFSC's intended timing to publish consultation feedback and the final fees notice