HM Government of Gibraltar has introduced amendments to its insurance legislation to permit Gibraltar licenced insurance intermediaries to appoint an insurance manager. In 1989 Gibraltar introduced legislation to allow insurance companies to appoint insurance managers to provide services such as accounting, book-keeping, company secretarial and a wide range of other activities.
Managing general agents (“MGAs”), a category within Gibraltar’s insurance intermediaries sector, can use the services of insurance managers for specific functions but until today they have not been able to formally appoint an insurance manager in a similar way to insurance companies.
The Hon Albert Isola MP, Gibraltar’s Minister for Digital and Financial Services, stated “These changes formalise the ability for Gibraltar MGAs to use an insurance manager. MGAs play an important role in the insurance market and we are keen to increase the number operating from Gibraltar. Our focus is on wholesale MGAs which work with authorised insurance brokers but we believe there are also opportunities for MGA incubators and more insurtechs to build their businesses here.
“Insurance managers provide an essential role for many new applicants and are one of the compelling reasons for Gibraltar’s continued appeal to new insurance business. Despite the challenges faced by the international community this year, we have seen a significant interest in new insurance applications in 2020.”
The new legislation formalises and regulates the outsourcing arrangements between insurance intermediaries and insurance managers, and introduces risk transfer requirements and outsourcing provisions into the Financial Services (Insurance Distribution) Regulations 2020.
Gibraltar’s long-term legal framework for UK market access is the Gibraltar Authorisation Regime (“GAR”) which forms part of the UK’s Financial Services Bill published on 21 October 2020. In the interim, market access continues to be the UK Statutory Instrument No. 589 of 2019 The Financial Services (Gibraltar) (Amendment) (EU Exit) Regulations 2019 as extended.
The GAR sets out the unique long-term legal framework for Gibraltar financial services firms to access the UK based on the alignment of standards and cooperation. Gibraltar will be introducing its own reciprocal legislation for UK firms to access Gibraltar.
The GFSC has published new guidance the “Managing General Agent (MGA) - Expectations Paper” that sets out the GFSC’s supervisory approach for MGAs.