What regulators want
Download
1 / 41

- PowerPoint PPT Presentation


  • 177 Views
  • Uploaded on

WHAT REGULATORS WANT. November 13, 2007. Disclaimer.

loader
I am the owner, or an agent authorized to act on behalf of the owner, of the copyrighted work described.
capcha
Download Presentation

PowerPoint Slideshow about '' - jana


An Image/Link below is provided (as is) to download presentation

Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author.While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server.


- - - - - - - - - - - - - - - - - - - - - - - - - - E N D - - - - - - - - - - - - - - - - - - - - - - - - - -
Presentation Transcript
What regulators want l.jpg

WHAT REGULATORS WANT

November 13, 2007


Disclaimer l.jpg
Disclaimer

The opinions expressed in this presentation are the opinions of the presenters and should not be construed to represent all situations or options and required actions may vary substantially depending on the domicile. Contact your regulator for additional information.


Panel of regulators l.jpg
Panel of Regulators

Craig Watanabe, Hawaii

Shanna Lespere, Bermuda

Dean Wickens, Cayman Islands

Jeff Kehler, South Carolina


Before you come to the regulator presented by craig watanabe l.jpg

Before You Come To The Regulator

Presented by

Craig Watanabe


Slide5 l.jpg


Slide6 l.jpg

b. Do your homework

(1) Be prepared to talk about the organizers. Proficient understanding and knowledge of parent company / organizers.

(a) Nature and scope of operations, financial position, ownership structure & corporate philosophy


Slide7 l.jpg

(2) Be prepared to talk about proposed captive. Proficient understanding of proposed captive program

(a) Objectives of captive program (short and long term)

(b) Organizational structure

(c) Operational requirements (including major service providers)

(d) Funding approach

(e) Insurance/reinsurance program design/structure

(f) Timing requirements for implementation


Slide8 l.jpg

c. Retain appropriate professional to coordinate & attend meeting (recommended)

d. Prepare any relevant questions for the regulator


Presented by shanna lespere l.jpg

Getting Your Captive Approved meeting (recommended)

Presented by

Shanna Lespere


Getting your captive approved l.jpg
Getting your Captive Approved meeting (recommended)

  • Regulating bodies recognize the importance in ensuring the efficiency and stability in the insurance market -strict conditions governing the formal approval of insurance companies are necessary to protect policy holders

  • Review of the insurance application, acceptability of proposed business and ongoing operations are considered


Reviewing process l.jpg
Reviewing Process meeting (recommended)

  • Bermuda's Assessment and Licensing Committee -Recommends to SOI eligibility to register

  • Determines conditions of Registration


Minimum application requirements l.jpg
Minimum Application Requirements meeting (recommended)

  • business plan

  • proforma income statements

  • actuarial support

  • letters of intent (business relationships)

  • regulatory letters

  • certificate of good standing

  • information on principals (co or individuals)

  • audited financial statements of parent

  • acceptance letters of service providers


Scope of license l.jpg
Scope of License meeting (recommended)

  • Class structure

  • General lines/long term

  • Intermediary


Minimum capital l.jpg
Minimum Capital meeting (recommended)

  • Capital requirements (quality)

  • Limits and risk coverage

  • Future development


Business plan l.jpg
Business Plan meeting (recommended)

  • Description of proposed business

  • Sound financial situation

  • Types of obligation

  • Reinsurance/ Rating

  • Agents/Brokers

  • Fronted

  • Solvency/Liquidity

  • Business volume and structure, premiums, commissions, admin/claims expenses, Investment income and tax


Suitability of key personnel l.jpg
Suitability of Key Personnel meeting (recommended)

  • Directors/ Senior Directors Qualifications

    • Prudent Conduct of Business


Suitability of owners l.jpg
Suitability of Owners meeting (recommended)

  • Ability for Sound and Prudent Management

  • Professionally Qualified

  • Reliable/ Good Repute

  • Transparent Structure


Other considerations l.jpg
Other Considerations meeting (recommended)

  • Affiliation contracts and outsourcing

  • Product control and General Policy Conditions

  • Actuaries, Auditors, Loss Reserve Specialists, Principal Representative


The ongoing relationship the seven habits of highly effective people captives l.jpg

The Ongoing Relationship meeting (recommended)The Seven Habits of Highly Effective People Captives

Presented by

Dean Wickens


Slide20 l.jpg

Insurance licence confers responsibilities. meeting (recommended)

Captive's relationship with its regulator is different...

A good on-going relationship with your regulator is essential / fundamental / integral (delete as applicable).


Habit number 1 l.jpg
Habit Number 1 meeting (recommended)

  • Understand your regulator’s role

    • Current and future policyholders

    • Jurisdiction's reputation


Habit number 2 l.jpg
Habit Number 2 meeting (recommended)

  • Maintain open dialogue

    • Take advantage of opportunities to meet with your regulator.

    • Advantages of open dialogue:

      • Reports to the main board

      • Allay regulator’s suspicions

      • Kept advised of developments


Habit number 3 l.jpg
Habit Number 3 meeting (recommended)

  • Know the legislation in your captive's jurisdiction.

    • Identify issues relevant to the parent

    • Notification or approval?


Habit number 4 l.jpg
Habit Number 4 meeting (recommended)

  • Ensure the captive complies with legislative requirements


Habit number 5 l.jpg
Habit Number 5 meeting (recommended)

  • Run off / exit plans


Habit number 6 l.jpg
Habit Number 6 meeting (recommended)

  • When problems do occur...


Habit number 7 l.jpg
Habit Number 7 meeting (recommended)

  • Think Win/Win


What to do when things go wrong presented by jeff kehler l.jpg

What To Do When Things meeting (recommended)

Go Wrong

Presented by

Jeff Kehler


Inform your regulator immediately l.jpg
Inform your regulator immediately meeting (recommended)

  • Sooner rather than later

  • Phone to initiate discussion

  • Formal follow-up with letter or e-mail


Provide factual details l.jpg
Provide factual details meeting (recommended)

  • When did you discover it?

  • Precise details as you know them

  • Why and how did it happen?

  • What is being done about right now?

  • Make arrangements to meet with regulator


Meeting with regulators l.jpg
Meeting with regulators meeting (recommended)

  • Depending on severity of situation

    • Teleconference with captive manager and captive owners

    • Face to face meeting with all parties

  • Provide details of the situation

  • Discuss options and work-out plan

  • Consider future viability


Prepare detailed work out plan l.jpg
Prepare Detailed Work-out Plan meeting (recommended)

  • Summary of current situation

    • How it happened and time frame

    • Be as precise as possible

  • Explain immediate actions taken to remediate the situation

  • Provide detailed action plan

    • Actionable items

    • Milestones

    • Timeframe


Prepare for regulatory action l.jpg
Prepare for regulatory action meeting (recommended)

  • Depending on the severity of the situation

  • Whack on the knuckles

  • Cease & Desist

    • Voluntary or mandatory

  • Supervision

    • Confidential or public

  • Rehabilitation

  • Liquidation


Cooperate fully with regulator l.jpg
Cooperate fully with regulator meeting (recommended)

  • Prompt replies to all requests

    • Phone calls, e-mails, letters, documents

  • Make available

    • Books, records, and accounts

  • Do not:

    • Obstruct

    • Interfere

    • Otherwise delay or sidetrack


Examples of things gone wrong l.jpg
Examples of things gone wrong meeting (recommended)

  • Minor

    • Failure or late notification of non-material changes to plan of operation

      • Change of service provider

      • Change of captive director or officer

      • Incidental change to investment policy

      • Change of location


Examples of things gone wrong36 l.jpg
Examples of things gone wrong meeting (recommended)

  • Material

    • Unauthorized payment of dividend

    • Unauthorized loan to parent or affiliate

    • Loss of front company

    • Cancellation of reinsurance

    • Increased exposure to captive, e.g., higher retentions, change in policy terms


Examples of things gone wrong37 l.jpg
Examples of things gone wrong meeting (recommended)

  • Major

    • Financial impairment

    • Illegal dealings

    • Evidence of embezzlement

    • Operation hazardous to policyholders


Summary l.jpg
Summary meeting (recommended)

  • When things go wrong

    • Contact your regulator immediately

    • Work closely with them to resolve the situation

    • Learn from it

    • What can be done to avoid it in the future?


Questions for the panel members l.jpg

Questions for the meeting (recommended)Panel Members?


Thank you panel members for your participation today l.jpg
Thank you meeting (recommended)panel members for your participation today.


Slide41 l.jpg

This program fulfills 1/3 meeting (recommended)rd of the teleconference requirement for the completion of the Associate in Captive Insurance (ACI) designation. It also counts as 100 minutes of continuing education (2 CPE credits) for CPAs via ICCIE’s certification through the National Association of State Boards of Accountancy (NASBA), as well as 2 continuing education credits for ACI designation recipients. It also counts as 2 contact hours through the American Society for Healthcare Risk Management for the FASRHM and DFASHRM designations, as well as for CPHRM renewal.


ad