Monkton
Insurance Services Limited
The application form for Registration as an Insurer is prescribed by the Insurance Act, 1978. A copy of the application form follows.
BERMUDA
PRE-INCORPORATION FORM
To be filed with Forms C-1 and C-2 by proposed
insurers
1. State the name of the Company
2. State the full address of
(a) the registered office of the Company in
Bermuda
(b) the principal office of the Company in Bermuda
(c) the
registered office and the principal business office abroad (in the case a company
incorporated abroad)
3a. State date and place of incorporation
3b. State the basic characteristics of the Company by ticking the appropriate boxes under (i) and (ii).
(i) Company organised by shares
Mutual company
(ii) Exempted company
Permit
company
3c.
(i) State the amount of the issued and paid-up capital at present,
and the date paid in.
(ii) Has the whole of the paid-up capital be subscribed
in cash? If not, give full details.
4a. Will the Company be writing unrelated risks (ie risks of persons who, apart
from the insurance contract itself, have no connection or association with the Company)
(i)
as a direct insurer
(ii) as a reinsurer
4b. If 4a(i) and 4a(ii) are
both answered in the negative, explain the nature of the connection or association
that exists between the Company and those persons whose risks the Company intends
writing either directly or as a reinsurer.
4c. State the category of the insurance
business which the insurer proposes to write (ie general business only, long-term
business only, or both general and long-term business).
4d. State the class
or classes (eg property, casualty, marine, aviation) of general insurance business
which the Company intends to write and state estimated gross and net premium by class
of business for the first 2 years of operation. If it is intended to write products
liability risk or professional liability risk or both, state estimated gross and
net premium in respect of each separately.
4e. State when the Company intends to commence writing the above class or classes
of business.
4f. In respect of general business, give estimated income for
each of the first 2 years on as realistic a basis as possible using the following
format
Gross Premiums Written
less Reinsurance Premiums Ceded
Net Premiums Written
less increase (plus decrease) in Unearned Premium
Net Premiums Earned
plus Investment Income
plus Other Insurance Income
SUBTOTAL
Net Losses and Loss Expenses Incurred
Reserve for Claims Incurred but not Reported
Commission and Brokerage Incurred
General and Administrative Expenses
Personnel Costs
Other Expenses
SUBTOTAL
Estimated Net Income for Year
NB 1. The regulations provide for a solvency margin in accordance with the following formula
General Business Premium Income Net Minimum paid-up Capital and Surplus BD$ 600,000 or less BD$ 120,000 BD$ 600,001 - BD$ 6,000,000 1/5th of GBPI BD$ 6,000,001 and above 1/10th of GBPI plus BD$ 600,000
NB 2. The Regulations provide for a minimum liquidity ratio for general business
as follows
"The value of the relevant assets of an insurer carrying on
general business shall not be less than seventy-five per centum of the amount of
its relevant liabilities, unless the insurer is a section 24(6) composite."
4g. In respect of long-term insurance business, state as an appendix set out in the format shown below, on as realistic a basis as possible, the estimated volume of business to be transacted during each of the first two years, giving for each type of policy the number of contracts, the total sums assured or amounts of annuity per annum, and the annual or single premiums - figures should be given both gross and net of reinsurance and should relate to worldwide business. A final table should summarise the total premium income.
ORDINARY LONG-TERM BUSINESS PLAN
Year 1
Type of policy No. of Contracts Total Premium Income Total sums insured
Gross Net or amounts of
annuity per annum
Note: Same format for year 2 as for year 1.
5. Give particulars of any business other than insurance business which the Company proposes to carry on.
6a. Give name of and limits carried by primary carrier, if any.
6b. State
the maximum net retention by class of business, for any one risk per occurrence.
6c.
State the layer of retention (primary or XXX excess of XXX) by class of business.
6d.
State whether annual aggregate (ie stop loss) reinsurance has been / will be arranged.If
so, state maximum annual aggregate net losses to be retained by class of business.
7. Set forth in the columns below the nature and extent of the existing or proposed reinsurance arrangements in respect of each class of business, including in particular the names of, and where they have been rated by recognised rating organisations, the most recent ratings assigned to, the insurance companies or associations of underwriters which will reinsure each class of the Company's business and the amount which will be reinsured by each. (If more than ten companies will reinsure a class business, the names of only the principal reinsurers need be stated.)
Name Rating Class of Insurance Amount Reinsured
8a. State the full name and address of the following who have accepted their appointment,
attaching formal evidence of acceptance of appointment duly signed
(i) Principal
Representative (must be resident in Bermuda)
(ii) Insurance Manager (if Company
has one)
(iii) Approved Auditor
(iv) (where required) Loss Reserve
Specialist
8b. For Companies carrying on long-term business - state the full name and address of the Approved Actuary, attaching formal evidence of acceptance of appointment duly signed.
9a. Indicate by ticking the appropriate boxes which of the following are located
in Bermuda
(i) general ledger
(ii) general journal
(iii) subsidiary
ledgers (referred to in the general ledger)
(iv) cash books - receipts and
disbursements
(v) premium registers
(vi) loss registers
(vii)
reinsurance reports
(viii) daily reports of claims files
(ix) copies
of policies
(x) copies of reinsurance treaties and agreements
9b. Will those of the foregoing business records which will be kept in Bermuda
enable the directors to ascertain within a reasonable period and with reasonable
accuracy the Company's position at the end of each three month period? Please answer
"Yes" or "No". If "No", please explain.
9c.
Give the addresses where such records are located in Bermuda.
10. State the date on which the Company's financial year will end.
11. If the answer to question 4a was in the affirmative
(a) state the method
or methods by which the business will be obtained (eg by the Company's own employees,
by brokers and agents, or by both methods).
(b) state the way in which settlement
of claims will be handled (eg by the Company, by outside loss adjusters or assessors,
or by other agents with authority to settle claims).
(c) give details of any
connection or association (including, in particular, a connection or association
of a financial kind) which exists between any of the brokers, agents, loss adjusters
and assessors referred to in (a) and (b) above, and any director of the Company,
any director it is proposed at present to appoint,any person having a majority shareholding
in the Company, or any other person on whose directions the directors of the Company
or any of them act or will act.
(d) Give details of any loans which the Company
has made, or proposes to make, to any officer of the Company or his spouse or to
any partnership in which an officer of the Company or his spouse has an interest.
(e)
Give details of any loans or investments, actual or proposed, to or in any subsidiary
or associated company or any company at any general meeting of which an officer of
the Company or any person controlling the Company, or his spouse, is entitled to
exercise, or control the exercise of, one third or more of the voting power.