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Contents  

Long Title

Part I PRELIMINARY

Part II CONDUCT OF INSURANCE BUSINESS

General restriction on insurers

Registration and authorisation of insurers

Deposits, registers of policies and insurance funds

Miscellaneous requirements as to conduct of business

Part IIA FOREIGN INSURER SCHEMES

Part IIB INSURANCE INTERMEDIARIES

General

Conduct of Insurance Broking Business

Part III RETURNS, INSPECTIONS AND INVESTIGATIONS

Returns

Inspections and Investigations

Part IIIA ASSISTANCE TO FOREIGN REGULATORY AUTHORITIES

Part IIIAA TRANSFER OF BUSINESS AND SHARES, RESTRUCTURING OF REGISTERED INSURER AND WINDING UP

Division 1 — Voluntary scheme for transfer of business

Division 2 — Compulsory transfer of business

Division 3 — Compulsory transfer of shares

Division 4 — Power to restructure capital

Division 5 — Winding up

Division 6 — Miscellaneous

Part IIIB APPEALS

Part IIIC NOMINATION OF BENEFICIARIES

Part IV MISCELLANEOUS AND GENERAL

Administration and enforcement

Miscellaneous amendments of law

Supplementary

FIRST SCHEDULE Definition of Insurance Terms

SECOND SCHEDULE Specified Provisions

Legislative History

Comparative Table

 
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PART IIB
INSURANCE INTERMEDIARIES
General
Insurance agent to operate under written agreement
35M.
—(1)  An insurance agent shall not arrange, or hold himself out as entitled to arrange, a contract of insurance as agent for a registered insurer unless an agreement in writing between the insurance agent and the insurer authorises the insurance agent to arrange, as agent for that insurer —
(a)
that contract;
(b)
any contract of insurance; or
(c)
any class of contracts of insurance which includes that contract.
[41/2001]
(2)  A registered insurer shall not cause or permit an insurance agent to arrange, or hold himself out as entitled to arrange, a contract of insurance as agent for that insurer unless an agreement in writing between the insurer and the insurance agent authorises the insurance agent to arrange, as agent for that insurer —
(a)
that contract;
(b)
any contract of insurance; or
(c)
any class of contracts of insurance which includes that contract.
[41/2001]
(3)  Subsections (1) and (2) shall not apply in relation to any act or thing done by an employee of a registered insurer in the course of performing his duties as such an employee.
[41/2001]
(3A)  Subsection (1) shall not apply to —
(a)
a licensed financial adviser;
(b)
a person exempt from holding a financial adviser’s licence in respect of any financial advisory service under section 23(1)(a), (b), (c), (d) or (e) of the Financial Advisers Act (Cap. 110), other than a registered insurer; and
(c)
a representative of a person referred to in paragraph (a) or (b),
where they arrange, or hold themselves out as entitled to arrange, a contract of insurance in respect of life policies, other than contracts for the reinsurance of liabilities under life policies, as agent for a registered insurer.
[23/2003 wef 01/01/2004]
(3B)  Subsection (1) shall not apply to a registered insurer and any insurance agent acting for that insurer where they arrange, or hold themselves out as entitled to arrange, a contract of insurance in respect of life policies, other than contracts for the reinsurance of liabilities under life policies, as agent for another registered insurer.
[23/2003 wef 01/01/2004]
(3C)  Subsection (2) shall not apply to a registered insurer in relation to an insurance agent who is a person specified in subsection (3A) or (3B).
[23/2003 wef 01/01/2004]
(4)  Any person who contravenes subsection (1) or (2) shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $25,000 or to imprisonment for a term not exceeding 12 months or to both and, in the case of a continuing offence, to a further fine not exceeding $2,500 for every day or part thereof during which the offence continues after conviction.
[41/2001]
Application of sections 35O to 35R and 35T, 35TA, 35U and 35V
35N.
—(1)  Sections 35O and 35Q shall not apply to a general reinsurance broker or life reinsurance broker in respect of contracts for the reinsurance of liabilities under insurance policies.
[41/2001]
[23/2003 wef 01/01/2004]
(2)  Section 35P shall not apply to —
(a)
a licensed financial adviser or exempt financial adviser, or its representatives, in respect of life policies, other than life policies with accident and health benefits and contracts for the reinsurance of liabilities under insurance policies; or
(b)
a general reinsurance broker or life reinsurance broker in respect of contracts for the reinsurance of liabilities under insurance policies.
[41/2001]
[23/2003 wef 01/01/2004]
(3)  Sections 35R, 35T, 35U and 35V shall not apply to a licensed financial adviser or an exempt financial adviser, or its representatives, in respect of life policies, other than contracts for the reinsurance of liabilities under insurance policies.
[23/2003 wef 01/01/2004]
(4)  Section 35TA shall not apply to a licensed financial adviser or an exempt financial adviser, or its representatives, in respect of life policies, other than life policies with accident and health benefits and contracts for the reinsurance of liabilities under insurance policies.
[23/2003 wef 01/01/2004]
Effect of payment to insurance intermediary
35O.
—(1)  Where a contract of insurance is arranged or effected by an insurance intermediary, payment to the insurance intermediary of moneys payable by the insured to the insurer under or in relation to the contract (whether in respect of a premium or otherwise) shall be a discharge, as between the insured and the insurer, of any liability of the insured under or in respect of the contract, to the extent of the amount of the payment.
[41/2001]
(2)  Payment to an insurance intermediary by or on behalf of an intending insured of moneys in respect of a contract of insurance to be arranged or effected by the insurance intermediary (whether the payment is in respect of a premium or otherwise) shall be a discharge, as between the insured and the insurer, of any liability of the insured under or in respect of the contract, to the extent of the amount of the payment.
[41/2001]
(3)  Payment by an insurer to an insurance intermediary of moneys payable to an insured (whether in respect of a claim, return of premiums or otherwise) under or in relation to a contract of insurance, shall not discharge any liability of the insurer to the insured in respect of those moneys.
[41/2001]
(4)  An agreement, insofar as it purports to alter or restrict the operation of subsection (1), (2) or (3), shall be void.
[41/2001]
(5)  Subsection (4) shall not render void an agreement between an insurance intermediary and an insured insofar as the agreement allows the insurance intermediary to set off, against moneys payable to the insured, moneys payable by the insured to the insurance intermediary in respect of premiums.
[41/2001]
Pre-contract disclosure by insurance intermediary
35P.
—(1)  No insurance intermediary shall invite any person to make an offer or proposal to enter into a contract of insurance without disclosing to the person all material information, including —
(a)
the name of the registered insurer;
(b)
his relationship with the registered insurer;
(c)
the premium charged by the registered insurer; and
(d)
such other information as the Authority may prescribe or specify in directions.
[23/2003 wef 01/01/2004]
[41/2001]
(2)  No insurance intermediary shall arrange any group policy for 2 or more persons where any person insured under the group policy is liable to pay the premium without disclosing to every person insured under the group policy all material information, including —
(a)
the name of the registered insurer;
(b)
his relationship with the registered insurer;
(c)
the conditions of the group policy;
(d)
the premium charged by the registered insurer; and
(e)
such other information as the Authority may prescribe or specify in directions.
[23/2003 wef 01/01/2004]
[41/2001]
(2A)  Any insurance intermediary who contravenes subsection (1) or (2) shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $25,000 or to imprisonment for a term not exceeding 12 months or to both.
[23/2003 wef 01/01/2004]
(3)  In this section, “insurance intermediary” includes the group policy owner of any group policy.
[41/2001]
Effect of payment to group policy owner and liability of insurer under group policy
35Q.
—(1)  This section applies to any group policy where any person insured under the group policy is liable to pay a premium.
[41/2001]
(2)  Payment to the group policy owner of moneys payable by any person insured under the group policy to the insurer under or in relation to the group policy (whether in respect of a premium or otherwise) shall be a discharge, as between the person insured and the insurer, of any liability of the person insured under or in respect of the group policy, to the extent of the amount of the payment.
[41/2001]
(3)  The registered insurer of a group policy shall pay the moneys due under the policy to the person insured or any person entitled through him if the person insured has paid the premium or is regarded as having paid the premium under subsection (2), and is entitled to the benefit under the policy.
[41/2001]
Representation by insurance intermediary
35R.
—(1)  No insurance intermediary shall, with intent to deceive, make a false or misleading statement as to —
(a)
any amount that would be payable in respect of a proposed contract of insurance; or
(b)
the effect of any provision of a contract of insurance or a proposed contract of insurance.
[41/2001]
(2)  A reference in subsection (1) to making a misleading statement includes a reference to omitting to disclose any matter that is material to a statement.
[41/2001]
(3)  No insurance intermediary shall, with intent to deceive, in relation to a proposed contract of insurance —
(a)
write on a form, being a form that is given or sent to an insurer, any matter that is material to the contract and is false or misleading in a material particular;
(b)
omit to disclose to the insurer any matter that is material to the proposed contract;
(c)
advise or induce the intending insured to write on a form, being a form that is given or sent to an insurer, any matter that is false or misleading in a material particular; or
(d)
advise or induce the intending insured to omit to disclose to the insurer any matter that is material to the proposed contract.
[41/2001]
(4)  No insurance intermediary shall, with intent to deceive, in relation to a claim under a contract of insurance —
(a)
fill up, in whole or in part, a form, being a form that is given or sent to an insurer, in such a way that the form is false or misleading in a material particular;
(b)
omit to disclose to the insurer any matter that is material to the claim;
(c)
induce the insured to fill up, in whole or in part, a form, being a form that is given or sent to the insurer, in such a way that the form is false or misleading in a material particular; or
(d)
advise or induce the insured to omit to disclose to the insurer any matter that is material to the claim.
[41/2001]
(5)  Any person who contravenes subsection (1), (3) or (4) shall, notwithstanding that a contract of insurance does not come into being, be guilty of an offence and shall be liable on conviction to a fine not exceeding $50,000 or to imprisonment for a term not exceeding 12 months or to both.
[41/2001]
[23/2003 wef 01/01/2004]
Insurance agent to act only for insurers entitled to carry on business in Singapore
35S.
—(1)  No person shall, without the approval of the Authority, act as an insurance agent for an insurer in respect of any insurance business which the insurer is not entitled to carry on in Singapore under this Act.
[41/2001]
(2)  Any person who contravenes subsection (1) shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $25,000 or to imprisonment for a term not exceeding 3 years or to both.
[41/2001]
(3)  Where the Authority has, under section 7 of the Insurance Intermediaries Act (Cap. 142A) in force before 1st October 2002*, approved any person to act as an insurance agent for an insurer in respect of any insurance business which the insurer is not entitled to carry on in Singapore, the approval shall continue in force as if granted by the Authority under subsection (1).
*   Date of commencement of section 20 of the Insurance (Amendment) Act 2001 (Act 41 of 2001).
[41/2001]
Control of written communication used by insurance intermediary
35T.
—(1)  The Authority may, by notice in writing, require any insurance intermediary to submit to it any written communication which is for the time being in use by the insurance intermediary for describing the terms or conditions of, or the benefits to be or likely to be derived from, policies.
[41/2001]
(2)  Where the whole or part of any written communication referred to in subsection (1) is not in English, there shall be submitted with it a translation in English.
[41/2001]
(3)  A requirement made under subsection (1), unless it is otherwise provided therein, shall apply to all such written communication coming into use after the making of the requirement and before the Authority notifies the insurance intermediary that the requirement is withdrawn.
[41/2001]
(4)  If it appears to the Authority that any such written communication used by an insurance intermediary contravenes any provision of this Part, or is in any respect likely to mislead, the Authority may (after affording the insurance intermediary an opportunity to make representations orally or in writing), by notice in writing, direct the insurance intermediary to discontinue the use in Singapore of the written communication immediately or from such date as may be specified in the notice.
[41/2001]
(5)  For each occasion on which any insurance intermediary fails to comply with a requirement under subsection (1) or uses any written communication in contravention of subsection (4), the insurance intermediary shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $25,000 or to imprisonment for a term not exceeding 12 months or to both.
[41/2001]
[23/2003 wef 01/01/2004]
(6)  In this section, “written communication” includes any brochure, leaflet, circular or advertising matter, whether in electronic, print or other form.
[41/2001]
Business conduct of insurance intermediaries
35TA.  Without prejudice to the generality of section 64(1) and (2), the Authority may make regulations or issue directions for or with respect to —
(a)
the standards to be maintained by an insurance intermediary in the conduct of business under this Act, including the standards in relation to the obligation to disclose information to insureds;
(b)
the qualifications, experience and training of an insurance intermediary and, where the insurance intermediary is a corporation or an association, of the officers, agents and employees of the insurance intermediary; and
(c)
the procedure for the conduct of disciplinary control of insurance intermediaries and, where the insurance intermediary is a corporation or an association, of the officers, agents and employees of the insurance intermediary.
[23/2003 wef 01/01/2004]
Obligation to furnish information to Authority
35U.  The Authority may, by notice in writing, require any insurance intermediary to furnish it with information about any matter related to his business carried on in Singapore or elsewhere if, in the opinion of the Authority, it requires that information for the discharge of its functions under this Act.
[41/2001]
Authority may prohibit person from carrying on business as insurance intermediary
35V.
—(1)  The Authority may, by order, prohibit any person from carrying on business as an insurance intermediary or from taking part, directly or indirectly, in the management of any insurance intermediary —
(a)
where the person has been convicted, whether in Singapore or elsewhere, of an offence involving fraud, dishonesty or moral turpitude or the conviction for which involved a finding that he acted fraudulently or dishonestly; or
(b)
where the Authority is satisfied that the person has —
(i)
forged policyholders’ signatures;
(ii)
misappropriated policyholders’ premiums;
(iii)
contravened any provision of this Act;
(iv)
given false, misleading or inaccurate information in its application to the insurer;
(v)
wilfully misled any policyholder when assisting him to fill up the proposal form;
(vi)
used dishonest means to meet the requirements set up by the insurer; or
(vii)
been involved in any activity prejudicial to the public interest.
[41/2001]
(2)  Before prohibiting any person from carrying on business as an insurance intermediary or from taking part, directly or indirectly, in the management of any insurance intermediary, the Authority shall —
(a)
give the person notice in writing of its intention to do so; and
(b)
in the notice referred to in paragraph (a), call upon the person to show cause within such time as may be specified in the notice why he or it should not be prohibited from carrying on business as an insurance intermediary or from taking part, directly or indirectly, in the management of any insurance intermediary, as the case may be.
[41/2001]
(3)  If the person to whom notice has been given under subsection (2) —
(a)
fails to show cause within the time given to him or it to do so or within such extended period of time as the Authority may allow; or
(b)
fails to show sufficient cause,
the Authority shall give notice in writing to that person of the date on which the prohibition is to take effect.
[41/2001]
(4)  Any person who is aggrieved by a decision of the Authority under subsection (1) may, within 30 days of the decision of the Authority, appeal to the Minister in writing in accordance with Part IIIB.
[41/2001]
(5)  No insurer or insurance intermediary shall employ or otherwise deal with any person who has been issued an order under subsection (1) where any activity to be undertaken by the person pursuant to such employment or dealing is prohibited by the order.
[41/2001]
(6)  Any person who —
(a)
fails to comply with an order of the Authority made under subsection (1) shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $75,000 or to imprisonment for a term not exceeding 2 years or to both;
(b)
contravenes subsection (5) shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $50,000 or to imprisonment for a term not exceeding 2 years or to both.
[41/2001]
(7)  Where the Authority has, under section 31 of the Insurance Intermediaries Act (Cap. 142A) in force before 1st October 2002, by order prohibited any person from carrying on business as an insurance intermediary or from taking part, directly or indirectly, in the management of any insurance intermediary, the order shall continue in force as if made by the Authority under subsection (1).
[41/2001]
Conduct of Insurance Broking Business
Insurance broker not to carry on business unless registered
35W.
—(1)  No person shall carry on business as any type of insurance broker in Singapore unless —
(a)
the person is registered by the Authority as that type of insurance broker; or
(b)
the person is exempted from registration under section 35ZN.
[23/2003 wef 01/01/2004]
(2)  Any person who contravenes subsection (1) shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $75,000 or to imprisonment for a term not exceeding 3 years or to both and, in the case of a continuing offence, to a further fine not exceeding $7,500 for every day or part thereof during which the offence continues after conviction.
[41/2001]
Registration of insurance brokers
35X.
—(1)  A person who desires to carry on business as an insurance broker shall apply in writing to the Authority for registration under this section and shall furnish such information as the Authority may require.
[41/2001]
(2)  Upon receiving an application under subsection (1), the Authority shall consider the application and may, subject to section 35Y —
(a)
register the applicant with or without conditions; or
(b)
refuse to register the applicant.
[41/2001]
(3)  The Authority may register the applicant as a direct insurance broker, general reinsurance broker, life reinsurance broker or a combination of any of these.
[41/2001]
[23/2003 wef 01/01/2004]
(4)  Subject to subsection (5), any person who has been registered under section 16 of the Insurance Intermediaries Act (Cap. 142A) in force before 1st October 2002 as a direct general insurance broker, general reinsurance broker, life reinsurance broker or a combination of any of these shall be deemed to be registered as such under subsection (2).
[41/2001]
[23/2003 wef 01/01/2004]
(5)  Any person who is registered or deemed to be registered under this section as a direct general insurance broker immediately before the date of commencement of the Insurance (Amendment) Act 2003 shall, as from that date, be deemed to be registered as a direct insurance broker under subsection (2).
[23/2003 wef 01/01/2004]
Registration requirements
35Y.
—(1)  The Authority shall not register any applicant under section 35X unless the applicant —
(a)
is a company;
(b)
has a paid-up share capital which is not less than such amount as may be prescribed; and
(c)
has in force a professional indemnity insurance policy, the cover of which is consistent with such limit and deductible requirements as may be prescribed.
[41/2001]
[23/2003 wef 01/01/2004]
(2)  For the purposes of subsection (1)(b) and (c), the Authority may prescribe different amounts for different types of insurance brokers.
[41/2001]
(3)  In subsection (1)(c), “professional indemnity insurance policy” means a contract of insurance with an insurer under which a person is indemnified in respect of the liabilities arising out of or in the course of his business as an insurance broker.
[41/2001]
Conditions of registration
35Z.
—(1)  The Authority may at any time add to, vary or revoke any existing condition of registration of an insurance broker or impose any new condition thereto.
[41/2001]
(2)  Any insurance broker which fails to comply with any of the conditions imposed by the Authority under subsection (1) or section 35X(2) shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $50,000 and, in the case of a continuing offence, to a further fine not exceeding $5,000 for every day or part thereof during which the offence continues after conviction.
[41/2001]
Annual fees
35ZA.
—(1)  Every registered insurance broker shall pay to the Authority such annual fees as may be prescribed.
[41/2001]
(2)  The Authority may prescribe different annual fees for different types of registered insurance brokers.
[41/2001]
(3)  The Authority may exempt wholly or in part any registered insurance broker from the payment of the annual fees prescribed under this section.
[41/2001]
Cancellation of registration
35ZB.
—(1)  The Authority may by order, at the request of the insurance broker or on any ground specified under subsection (2), cancel the registration of any insurance broker.
(2)  The grounds referred to in subsection (1) are —
(a)
that the insurance broker has not commenced business within 6 months after being registered;
(b)
that the insurance broker has ceased to carry on the business for which it is registered;
(c)
that, it appears to the Authority, the insurance broker has failed to satisfy any obligation to which it is subject by virtue of this Act;
(d)
that there exists a ground on which the Authority would be prohibited by section 35Y from registering the insurance broker;
(e)
that the insurance broker —
(i)
proposes to make, or has made, any composition or arrangement with its creditors;
(ii)
has gone into liquidation; or
(iii)
has been wound up or dissolved;
(f)
that the insurance broker is carrying on its business in a manner likely to be detrimental to the interests of policy owners for whom it is acting as an agent;
(g)
that the insurance broker is unable to meet its obligations;
(h)
that the insurance broker has contravened any provision of this Act or any condition imposed or any direction given by the Authority under this Act;
(i)
that any of the officers of the insurance broker holding a managerial or executive position has been convicted of any offence under this Act;
(j)
that the insurance broker has furnished false, misleading or inaccurate information, or has concealed or failed to disclose material facts, in its application for registration; and
(k)
that it is in the public interest to cancel the registration.
[41/2001]
(3)  Before cancelling the registration of an insurance broker under this section otherwise than at its request, the Authority shall —
(a)
give the insurance broker notice in writing of its intention to do so; and
(b)
in the notice referred to in paragraph (a), call upon the insurance broker to show cause within such time as may be specified in the notice why its registration should not be cancelled.
[41/2001]
(4)  If the insurance broker to whom notice has been given under subsection (3) —
(a)
fails to show cause within the time given to it to do so or within such extended period of time as the Authority may allow; or
(b)
fails to show sufficient cause,
the Authority shall give notice in writing to the insurance broker of the date on which the cancellation of registration is to take effect.
[41/2001]
(5)  Any insurance broker which is aggrieved by a decision of the Authority under subsection (1) to cancel its registration as an insurance broker otherwise than at its request may, within 30 days of the decision of the Authority, appeal to the Minister in writing in accordance with Part IIIB.
[41/2001]
(6)  Notwithstanding the fact that the registration of an insurance broker has been cancelled under this section, so long as the insurance broker remains under any liability to an insurer, insured or intending insured, the insurance broker shall take such action as it considers necessary or as may be required by the Authority to ensure that reasonable provision has been or will be made for that liability.
[41/2001]
(7)  If the registration of a person as an insurance broker has been cancelled or has expired, sections 35ZC and 36 shall, unless the Authority otherwise directs, continue to apply in relation to the person in respect of matters that occurred before the cancellation or expiration as if its registration had not been cancelled or had not expired, as the case may be.
[41/2001]
Duty to maintain net asset value
35ZC.  Every registered insurance broker shall maintain a net asset value of such amount as may be prescribed.
[41/2001]
Insurance broking premium accounts
35ZD.
—(1)  Subject to subsection (2), every registered insurance broker which receives any money —
(a)
from or on behalf of an insured or intending insured for or on account of an insurer in connection with a contract of insurance or proposed contract of insurance; or
(b)
from or on behalf of an insurer for or on account of an insured or intending insured,
shall, for the purposes of this section, establish and maintain a separate account with a bank licensed under the Banking Act (Cap. 19).
[23/2003 wef 01/01/2004]
(2)  Where the registered insurance broker is registered under section 35X to carry on business as more than one type of insurance broker, it shall establish and maintain separate accounts with a bank licensed under the Banking Act in respect of the carrying on of business of each type of insurance broker for which it is registered.
[41/2001]
(3)  The Authority may prescribe, in relation to an account established under subsection (1) or (2) —
(a)
the types of moneys that must be paid into or withdrawn from such account;
(b)
the manner in which moneys should be paid into or withdrawn from such account;
(c)
the manner in which moneys held in such account are to be invested;
(d)
the manner in which the proceeds from the investment of moneys held in such account are to be distributed;
(e)
the rights and obligations of any party in relation to moneys held in such account; and
(f)
any other matter which the Authority considers to be incidental to or necessary for this section.
[41/2001]
(4)  A lien or claim on the moneys in any account established by any registered insurance broker under subsection (1) or (2) shall be void unless the moneys in the account are for fees due and owing to the registered insurance broker.
[41/2001]
(5)  A charge or mortgage on the moneys in any account established by any registered insurance broker under subsection (1) or (2) shall be void.
[41/2001]
(6)  Any registered insurance broker which contravenes subsection (1) or (2) shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $100,000.
[41/2001]
(7)  In this section, “moneys” means any sum received by a registered insurance broker as agent for an insured or intending insured, including policy moneys, premiums and claims payments.
[41/2001]
Negotiation and placement of risk with unregistered insurer
35ZE.
—(1)  Subject to sections 35ZF and 35ZG, no registered insurance broker shall, in the course of its business as such, negotiate any contract of insurance with an insurer (directly or indirectly) except with a registered insurer acting in the course of its business as such.
[41/2001]
(2)  The reference in subsection (1) to a contract of insurance shall not apply to —
(a)
reinsurance;
(b)
business relating to risks outside Singapore; or
(c)
such other risks as may be prescribed.
[41/2001]
(3)  Any person who contravenes subsection (1) shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $25,000 or to imprisonment for a term not exceeding 3 years or to both.
[41/2001]
(4)  In subsection (2), “risks outside Singapore” means any risk which would be classified as an offshore policy as defined in the First Schedule had the risk been underwritten by a registered insurer in Singapore.
[41/2001]
[23/2003 wef 01/01/2004]
Permission to negotiate and place risk with unregistered insurer
35ZF.
—(1)  Where in any particular case the Authority is satisfied that, by reason of the exceptional nature of the risk or other exceptional circumstances, it is not reasonably practicable to comply with section 35ZE, the Authority may permit any registered insurance broker —
(a)
to negotiate the contract of insurance with such insurer as the insurance broker sees fit; and
(b)
if in the opinion of the Authority the case requires it, to effect the contract of insurance and receive the premium in Singapore on behalf of such insurer.
[41/2001]
(2)  Where the Authority has, under section 23(5) of the Insurance Intermediaries Act (Cap. 142A) in force before 1st October 2002, granted any registered insurance broker permission to negotiate with any unregistered insurer as the insurance broker sees fit and, if the case requires it, to effect the contract of insurance and receive the premium in Singapore on behalf of the insurer, the permission shall continue in force as if granted by the Authority under subsection (1).
[41/2001]
Negotiation and placement of risk with foreign insurer
35ZG.
—(1)  Without prejudice to section 35ZF, a registered insurance broker may negotiate any contract of insurance referred to in section 35ZE with a foreign insurer under a foreign insurer scheme under Part IIA if he is authorised to do so under a licence issued by the Authority.
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(2)  Any person who wishes to obtain a licence under subsection (1) shall apply to the Authority in such manner as the Authority may determine and furnish such information as the Authority may require.
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(3)  In issuing a licence under subsection (1), the Authority may impose such conditions as it thinks fit and may at any time add to, vary or revoke such conditions.
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(4)  The issue of a licence by the Authority under subsection (1) shall be subject to the payment of such annual fees as may be prescribed.
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(5)  Section 35ZB shall apply, with the necessary modifications, in relation to the cancellation of a licence issued under subsection (1).
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(6)  Where, immediately before 1st October 2002, a person has a licence under section 8 of the Insurance Intermediaries Act (Cap. 142A) in force before that date, he shall be deemed to have been issued, subject to the same terms and conditions but only in so far as they are not inconsistent with the provisions of this Act, with a licence under subsection (1) to negotiate contracts of insurance referred to in section 35ZE with such foreign insurers under any foreign insurer scheme under Part IIA as the Authority may determine.
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Restriction as to receipt and payment of remuneration
35ZH.
—(1)  An insurer shall not pay to a registered insurance broker, and a registered insurance broker shall not receive from an insurer, in respect of the arranging or effecting of contracts of insurance by the insurance broker with the insurer, remuneration at a rate or on a basis that has been varied, having regard solely to all or any of the following:
(a)
the number of contracts so arranged or effected;
(b)
the total amount of premiums paid or payable under such contracts;
(c)
the total amount of sums insured under such contracts.
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(2)  Subsection (1) shall not apply to the receipt and payment of profit commissions.
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(3)  Any person who contravenes subsection (1) shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $50,000 or to imprisonment for a term not exceeding 12 months or to both and, in the case of a continuing offence, to a further fine not exceeding $5,000 for every day or part thereof during which the offence continues after conviction.
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(4)  This section shall not apply to general reinsurance brokers and life reinsurance brokers in respect of contracts for the reinsurance of liabilities under insurance policies.
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Control of take-over of insurance broker
35ZI.
—(1)  This section shall apply to and in relation to all individuals whether resident in Singapore or not and whether citizens of Singapore or not, and to all bodies corporate or unincorporate, whether incorporated or carrying on business in Singapore or not.
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(2)  No person shall enter into an agreement to acquire shares of a registered insurance broker by virtue of which he would, if the agreement is carried out, obtain effective control of that insurance broker without first notifying the Authority of his intention to enter into the agreement and obtaining the approval of the Authority to his entering into the agreement.
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(3)  For the purposes of this section —
(a)
a person shall be regarded as obtaining effective control of a registered insurance broker by virtue of an agreement if the person alone or acting together with any associate or associates would, if the agreement is carried out —
(i)
acquire or hold, directly or indirectly, 20% or more of the issued share capital of the insurance broker; or
(ii)
control, directly or indirectly, 20% or more of the voting power of the insurance broker;
(b)
a reference to entering into an agreement to acquire shares includes —
(i)
a reference to a person making or publishing a statement, however expressed, that expressly or impliedly invites a holder of shares to offer to dispose of his shares to the first person; and
(ii)
a reference to a person obtaining a right to acquire shares under an option, or to have shares transferred to himself or to his order, whether the right is exercisable presently or in the future and whether on fulfilment of a condition or not;
(c)
a reference to the voting power in a registered insurance broker is a reference to the total number of votes that might be cast in the general meeting of the insurance broker; and
(d)
a person, A, is an associate of another person, B, if —
(i)
A is the spouse or a parent or remoter lineal ancestor, or a son, daughter or remoter issue, or a brother or sister, of B;
(ii)
A is a partner of B;
(iii)
A is a corporation of which B is an officer;
(iv)
where B is a corporation, A is an officer of B;
(v)
A is an employee or employer of B;
(vi)
A is an officer of any corporation of which B is an officer;
(vii)
A is an employee of an individual of whom B is an employee;
(viii)
A is a corporation whose directors are accustomed or under an obligation, whether formal or informal, to act in accordance with the directions, instructions or wishes of B or, where B is a corporation, of the directors of B;
(ix)
B is a person who is accustomed or under an obligation, whether formal or informal, to act in accordance with the directions, instructions or wishes of A or the directors of A, where A is a corporation;
(x)
A is a corporation in which B is in a position to control not less than 20% of the voting power in A; or
(xi)
where B is a corporation, A is a person who is in a position to control not less than 20% of the voting power in B.
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(4)  Any person who contravenes subsection (2) shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $25,000 or to imprisonment for a term not exceeding 2 years or to both.
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Approval or removal of chief executive officer and director of insurance broker
35ZJ.
—(1)  No registered insurance broker shall appoint a person as its chief executive officer or director in Singapore unless it has obtained the approval of the Authority.
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(1A)  Where a registered insurance broker has obtained the approval of the Authority to appoint a person as its chief executive officer or director under subsection (1), the person may be re-appointed as chief executive officer or director, as the case may be, of the registered insurance broker immediately upon the expiry of the earlier term without the approval of the Authority.
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(2)  If at any time it appears to the Authority that a chief executive officer or director of a registered insurance broker has failed to perform his functions or is no longer a fit and proper person to be so appointed, the Authority may, in writing, direct the insurance broker to remove the chief executive officer or director, as the case may be.
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(3)  For the purpose of determining whether to grant its approval under subsection (1) or whether the chief executive officer or director has failed to perform his functions under subsection (2), the Authority shall, without prejudice to any other matter that it may consider relevant, have regard to such criteria as may be prescribed.
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(4)  Before directing the registered insurance broker to remove its chief executive officer or any director under subsection (2), the Authority shall —
(a)
give the registered insurance broker notice in writing of its intention to do so; and
(b)
in the notice referred to in paragraph (a), call upon the registered insurance broker to show cause within such time as may be specified in the notice why the chief executive officer or director, as the case may be, should not be removed.
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(5)  If the registered insurance broker referred to in subsection (4) —
(a)
fails to show cause within the time given to it to do so or within such extended period of time as the Authority may allow; or
(b)
fails to show sufficient cause,
the Authority shall give notice in writing to the insurance broker of the date on which the direction to remove the chief executive officer or director, as the case may be, is to take effect.
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(6)  Any person who is aggrieved by a decision of the Authority under subsection (1) or (2) may, within 30 days of the decision of the Authority, appeal to the Minister in writing in accordance with Part IIIB.
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(7)  Any registered insurance broker which fails to comply with any direction of the Authority under subsection (2) shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $150,000.
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(8)  Any approval by the Authority for a registered insurance broker to appoint a person as its chief executive officer or director in Singapore under section 26 of the Insurance Intermediaries Act (Cap. 142A) in force before 1st October 2002 shall continue in force as if approved by the Authority under subsection (1).
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(9)  Nothing in section 152 of the Companies Act (Cap. 50) shall prevent the Authority from exercising any power under subsection (2).
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(10)  In this section, “chief executive officer” means any person by whatever name described, who is —
(a)
in the direct employment of, or acting for, or by arrangement with a registered insurance broker; and
(b)
directly responsible for the conduct of any type of business of the insurance broker in Singapore.
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Restriction on granting of unsecured loans or advances to director and employee of or adviser engaged by registered insurance broker
35ZK.
—(1)  Without prejudice to section 162 of the Companies Act, no registered insurance broker shall, on or after 1st October 2002, in respect of its business in Singapore, grant, directly or indirectly, any unsecured loan or unsecured advance —
(a)
to a director of the insurance broker, other than a director who is its employee; or
(b)
to an employee of the insurance broker, including a director who is its employee, or a person engaged by the insurance broker to provide technical advice to clients, which in the aggregate and outstanding at any one time exceeds the sum of $3,000.
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(2)  No registered insurance broker shall, on or after 1st October 2002 —
(a)
increase the amount of any unsecured loan or unsecured advance granted to any person referred to in subsection (1)(a) before that date; or
(b)
increase the amount of any unsecured loan or unsecured advance granted to any person referred to in subsection (1)(b) before that date if the total amount granted to that person will exceed the sum stated in that subsection.
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(3)  Any registered insurance broker which contravenes subsection (1) or (2) shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $12,500 and, in the case of a continuing offence, to a further fine not exceeding $1,250 for every day or part thereof during which the offence continues after conviction.
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(4)  In this section, “director” includes the spouse, father, step-father, mother, step-mother, son, step-son, daughter, step-daughter, brother or sister of a director.
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Holding out as registered insurance broker
35ZL.
—(1)  No person shall hold himself out to be registered as a direct insurance broker, general reinsurance broker or life reinsurance broker unless he is registered under this Act as such.
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(2)  Any person who contravenes subsection (1) shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $50,000 or to imprisonment for a term not exceeding 12 months or to both and, in the case of a continuing offence, to a further fine not exceeding $5,000 for every day or part thereof during which the offence continues after conviction.
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Use of words “insurance broking”
35ZM.
—(1)  No person, other than a registered insurance broker or an insurance broker who is exempt from registration under section 35ZN(1)(a), (b), (c), (d), (e) or (ea), shall —
(a)
use the words “insurance broking” or any of its derivatives in any language, or any other word indicating that that person carries on business as an insurance broker in the name, description or title under which it carries on business in Singapore; or
(b)
make any representation to such effect in any bill head, letter paper, notice, advertisement, publication or writing, including in electronic form, or in any other manner.
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(2)  Nothing in this section shall prohibit an association of insurance brokers from using the words “insurance broking” or any of its derivatives in any language as part of its name or description of its activities, subject to the Authority’s prior written approval.
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(3)  Nothing in this section shall apply to the use of the words “life insurance broking” or any of its derivatives.
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(4)  Any person who contravenes subsection (1) shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $12,500 and, in the case of a continuing offence, to a further fine not exceeding $1,250 for every day or part thereof during which the offence continues after conviction.
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(5)  Any association of insurance brokers that, immediately before 1st October 2002, had been using the words “insurance broking” or any of its derivatives in any language, in any bill head, letter paper, notice, advertisement, publication or writing or in any other manner, shall be deemed to have been granted approval under subsection (1) to use such words in the same manner.
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Exempt insurance brokers
35ZN.
—(1)  The following persons (referred to in this section as exempt insurance brokers) shall be exempt from registration as insurance brokers:
(a)
a bank licensed under the Banking Act (Cap. 19);
(b)
a merchant bank approved as a financial institution and approved to carry on business as an insurance broker under the Monetary Authority of Singapore Act (Cap. 186);
(c)
a licensed financial adviser under the Financial Advisers Act (Cap. 110);
(d)
a holder of a capital markets services licence under the Securities and Futures Act (Cap. 289);
(e)
a finance company which has been granted an exemption from section 25(2) of the Finance Companies Act (Cap. 108) to carry on business as an insurance broker;
(ea)
a direct insurer registered to carry on life business; and
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(f)
such other persons or class of persons as may be prescribed, subject to such conditions as the Authority may impose.
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(2)  Subject to this Act, sections 35ZD, 35ZE, 35ZF and 35ZH shall, with the necessary modifications, apply to the persons referred to in subsection (1) (other than persons referred to in subsection (1)(f)) in respect of their business as insurance brokers as if they are registered insurance brokers.
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(2A)  For the avoidance of doubt, references in subsection (2) to specific sections in this Act that apply to the persons referred to in that subsection do not include references to any regulations made under those sections unless the Authority prescribes that such regulations so apply.
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(3)  The Authority may prescribe or specify in directions the provisions of this Act that apply to the persons referred to in subsection (1)(f).
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(4)  The Authority may by written directions impose such conditions or restrictions as it deems fit on an exempt insurance broker or a class of exempt insurance brokers.
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(5)  The Authority may withdraw an exemption granted to any person under this section if the person contravenes any provision of this Act applicable to him or if the Authority considers it necessary in the public interest.
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(6)  A withdrawal of an exemption under subsection (5) shall not operate so as to —
(a)
avoid or affect any agreement, transaction or arrangement, relating to any contract of insurance entered into by the person, whether the agreement, transaction or arrangement was entered into before or after the withdrawal of the exemption; or
(b)
affect any right, obligation or liability arising under any agreement, transaction or arrangement referred to in paragraph (a).
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(7)  Any exempt insurance broker who is aggrieved by a decision of the Authority to withdraw the exemption under subsection (5) may, within 30 days of the decision, appeal in writing to the Minister in accordance with Part IIIB.
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(8)  Any exempt insurance broker who contravenes any condition or restriction imposed by the Authority under subsection (4) shall be guilty of an offence and shall be liable on conviction to a fine not exceeding $12,500 and, in the case of a continuing offence, to a further fine not exceeding $1,250 for every day or part thereof during which the offence continues after conviction.
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Registers maintained by Authority
35ZO.
—(1)  The Authority shall establish and maintain one or more registers in respect of the following persons:
(a)
registered insurance brokers;
(b)
persons removed by registered insurance brokers as directed by the Authority in exercise of its powers under section 35ZJ;
(c)
persons against whom a prohibition order is made under section 35V; and
(d)
such other persons as may be prescribed.
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(2)  The Authority may prescribe the manner in which the registers are established or maintained, including the details or particulars required to be entered in the registers.
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(3)  Any person may, upon payment of the prescribed fee, inspect and take an extract from the registers established under subsection (1), and any such extract, certified by the Authority to be a true copy, shall be admissible as evidence in any legal proceedings.
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