Guide to Set Up Labuan Insurance Broker
Labuan Insurance Broker is defined as a person who is licensed to arrange Labuan insurance business on behalf of prospective or existing policy owners and arrange Labuan reinsurance business on behalf of any insurer seeking reinsurance.
Additionally, a Labuan Insurance Broker may perform financial planning activities. A Labuan insurance broker is prohibited from dealing with residents (except for high-net-worth individuals, reinsurance and others as defined by Labuan FSA from time to time) and broker for direct Malaysian risks. The applicant should have at least 3 years of relevant experience or audited annual accounts of the company.
The Approved Activities for Labuan Insurance Broker:
Direct insurance business: May broke direct insurance business (except direct Malaysian risks) with any insurance company irrespective of whether they are licensed under Labuan Financial Services and Securities Act 2010 (LFSSA) or otherwise.
Life insurance business: May broke life insurance policy for high net worth individual Malaysians with life insurance companies licensed under LFSSA.
Reinsurance business: May broke reinsurance of direct Malaysian risks transacted in Malaysian ringgit.
Licensing and Operational Requirements for Labuan Insurance Broker:
- Maintain minimum paid-up capital or working funds of RM300,000 or its equivalent in any foreign currency.
- Must be a member of the Labuan International Insurance Association.
- Must provide a letter of guarantee or undertaking from the parent company to Labuan FSA (if applicable)
- For operations, required to establish an operational office in Labuan with minimum 2 staffs with annual spending of RM100,000
- Must appoint an auditor
- Appointment of any person in control, director or principal officer (PO) must obtain prior approval from Labuan FSA. However, Labuan insurance brokers that are established as a branch are not required to obtain approval on the appointment of their directors.
- The person in control, director and PO must be fit and proper persons and shall not be subject to any adverse report from any reliable sources.
- Must have professional indemnity insurance coverage of a minimum of RM2.5 million or its equivalent in any foreign currency.
- Comply to yearly corporate tax filing with Labuan Inland Revenue Board and Labuan FSA.
- Other ON-GOING OPERATIONAL OF INSURANCE BROKER LICENSE
- Have a Principal Representative (insurance manager) and monitoring the company’s compliance with the Labuan Financial Services and Securities Act, 2010 and related regulations.
- Maintain liaison with the Tricor Trustco (company secretary) on the company to facilitate the company’s compliances with Labuan FSA, rules and regulations and other related authorities such as tax, auditor, etc
- Liaison with the Labuan Financial Services Authority (Labuan FSA) for the latest updates, reporting, rulings or approvals are required including payment of license fee.
- Record-keeping of the books of accounts and correspondences relating to the business of the Company.
- Record-keeping of inward and outward correspondence records and forwarding documents as and when required
- Record-keeping of policy contracts, commission statements, statements of accounts, debit notes, credit notes, and correspondences.
- Record-keeping of all financial records and statutory records/documents for the auditor to audit the accounts.
License Fee for Labuan Insurance Broker:
The initial license fee of USD6,500 is payable to Labuan FSA upon approval of the license. Thereafter, the yearly license fee of RM USD6,500 will be payable by 15th Jan.
TRICOR TRUSTCO provides a one-stop application solution for Labuan Insurance Broker License includes:
- Consultation of your eligibility and procedures based on your profile
- Profiling, due diligence and guidance on documents preparation
- Preparation of Business Plan and Financial Forecast, AMLA and KYC Framework
- Submission and supervise the application process
- Act as your liaison and contact point with Labuan FSA for all correspondence and arrange an interview (if any)
- Track the license approval and attend all queries from Labuan FSA
WHY TRICOR TRUSTCO for Your LABUAN SET UP?
We are a full-fledged licensed Labuan Trust Company (Trust License No. LT 0034) with a highly experienced team of dedicated professionals handle all license applications. We provide complete “one-stop” solutions in pre-assess, meet, planning, structuring, establishment and corporate service for your Labuan Insurance Business, ensuring you get a bespoke service that meets your insurance business needs as well as onwards operation.
Feel free to call us at +603-2783 9191 (Labuan Division) for an appointment if you have decided to start your Labuan Insurance Broker business for the personal meeting. Alternatively, email us if you are interested to find out more about Labuan Insurance Broker License application and your eligibility. TRICOR’s One Labuan Platform easy to elevate your Labuan operation efficiently!
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