JLT Insurance Management Guernsey Ltd

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1 JLT Insurance Management Guernsey Ltd Insurance Management and Advisory Services Distinctive. Choice. JLT INSURANCE MANAGEMENT

2 Distinctive. Choice. JLT is an international group of Risk Specialists and Employee Benefits Consultants and one of the largest of its type in the world. We offer a distinctive choice to our clients and partners through our combination of independence, scale and specialism. As an independent business, we are able to operate with autonomy and flexibility. We have the scale to provide solutions to the complex demands of the world s leading companies and to deliver global servicing whilst recognising that the needs of each of our clients is unique. By developing highly specialised services, we provide our clients with a depth of expertise and experience. The value we create is driven through the personal determination of our 5,500 highly motivated and skilled people.

3 JLT AND CAPTIVES Today companies with a global approach to risk financing recognise that insurance captives can play an increasingly important role in their strategy. In addition to insurance management our consultancy team provides: Captive feasibility studies Programme design Funding analysis Captive exit strategies JLT has helped a broad spectrum of clients to achieve their financial and strategic objectives through captives under our management. Since we launched our insurance management services in 2000 our team has built a client base of 80 companies under management, writing premiums of US$1 billion with assets of US$2 billion. 20 of these companies have transferred to JLT from other managers. Our Reach We provide insurance management and consulting services from the following domiciles: Captive efficiency and strategy reviews We have a proven record in assisting clients to select the proper domicile for their captive insurance company by evaluating business goals and operational issues. We can also help with the technical problems of migrating captives from one domicile to another. At JLT the outsourcing of your insurance operation will be in the hands of experienced, professional people who look for every opportunity to optimise the contribution made to your risk financing goals. For further information see Bermuda Malta Guernsey Singapore We also offer access to services in Luxembourg and Zurich through an associate company and from Gibraltar and Ireland via selected independent managers. 1

4 JLT in Guernsey JLT Insurance Management (Guernsey) Ltd is a leading provider of insurance and reinsurance management services. We provide management services to a mix of captives, reinsurance companies and companies participating in customer insurance, generating in excess of 50m of annual gross premium and growing. Our primary source of business is the United Kingdom, but we also have clients from Australia, Holland, South Africa, Sweden and Switzerland. Guernsey continues to be one of the most active domiciles for business outside of the Americas. Its sound but flexible regulation coupled with innovations such as Protected Cell Companies (PCC) and Incorporated Cell Companies (ICC) has helped to keep its insurance sector vibrant and responsive to clients needs. Its proximity to the London and Lloyd s markets also make it attractive to captives and new niche reinsurance operations. Why JLT Insurance Management in Guernsey? We believe that the key to our success is to provide truly superior service to our clients. We achieve this by committing to each client a team of accounting and insurance professionals coupled with a very hands on approach by our senior and most experienced managers. We have developed a solid reputation for quality service and we maintain a BS EN ISO 9001:2000 Quality Management accreditation from Lloyd s Register. We can provide secure online access to your company s data and records through a discrete tailored website. JLT Insurance Management can also provides access to our Rent-a-Captive facility Isosceles PCC Ltd. If you would like us to help you determine why Guernsey may be the right location for a new insurance venture then please contact us or call one of the team. For further information see There is no restriction on the types of insurance or reinsurance company we manage and our capabilities extend beyond managing pure captives. 2

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6 Why Guernsey Guernsey is a British Crown Dependency, which means the island s links to the United Kingdom are through the Crown rather than the British Parliament.. Guernsey has over 800 years of self-government it is legislatively and fiscally independent of the UK and has its own democratically elected parliament, The States of Deliberation. The island s parliament has and continues to deliver political and economic stability on which business can rely and means the island can and does respond quickly to the needs of business. The island also has a special relationship with the European Union, which means that the island is within the Common Customs Area and the Common External Tariff (i.e. it enjoys access to EU countries for physical exports without tariff barriers) but other EU directives, including insurance/ reinsurance measures, do not apply unless voluntarily accepted. Conducting business in Guernsey is also made easy because the island is English speaking; uses the British pound (Sterling); is in the same time zone as the UK, which means there can be interaction with both the Americas and the Middle East during one working day; is situated in an area with a temperate climate (and no exposure to natural disasters); and is located close to both the UK and continental Europe, with daily air links to London, Paris and Zurich. 4

7 IMAGE AREA These unique characteristics have helped Guernsey establish and maintain a thriving and broad-based finance centre that comprises not just a leading international insurance industry but also: Banking 50 licensed banks holding deposits of US$210bn; Investment funds Assets under administration and management of US$280bn; Fiduciary and trusts Some 140 licensed companies with assets in trust of US$400bn; Alongside these businesses has grown a comprehensive network of complementary services, including actuarial, legal, accounting, audit and tax advisers. Zero rate of tax Insurance is recognised as an important contributor to the Guernsey economy. In recognition, international insurance and reinsurance business will be zero-rated for tax purposes. Channel Islands Stock Exchange (CISX) Established in Guernsey, the exchange is recognised in both London and New York and offers a cost-effective platform for listings, of which there are now more than 2,000. 5

8 Reinsurance Expertise Guernsey is a leading jurisdiction for insurance. Subsidiaries of major companies such as AIG, Catlin, Generali, Hiscox, Old Mutual, Royal & SunAlliance and SCOR all have operations within the island. The island writes a wide range of business and has a thriving international life assurance sector, although it is captive insurance for which the island is renowned. Approximately 40% of the top 100 companies on the London Stock Exchange have captives in Guernsey and it also plays host to captives with parents from across the globe. Since the first captive insurance company in Guernsey was formed in 1922 the island has become Europe s leading captive insurance domicile, with over 600 captive entities and amongst the top four in the world in terms of premiums written. It has been calculated that of the US$6.5bn of international insurance premiums written on the island annually, just under US$1.3bn is life assurance and employee benefit business and a majority percentage of the remaining $US5.2bn is inwards captive reinsurance. Guernsey has all of the keys features which would allow niche reinsurance operations to flourish. The regulation provides a flexible rather than prescriptive approach to capital requirements. The legislation provides very well for the creation of special purpose vehicles that can facilitate transformers, sidecars, securitisation and swaps required for the growing trend in reinsurance linked derivative business. 6

9 IMAGE AREA Pull quote text here. This box should sit over an image and be filled with 100% pantone 289 at a 75% opacity The island offers a very efficient licensing process thus facilitating speed to market which is often important for niche reinsurance and derivative solutions. Regulation and legislation in Guernsey is fast to adapt to the needs of the market. As well as a favourable regulatory environment the island does not tax insurance or reinsurance operations and this helps to enhance the return on capital available to companies establishing here. Guernsey can boast that on the one hand, it is a jurisdiction with mature insurance legislation it was, 21 years ago, one of the first to introduce a regulatory regime for captives and on the other, modern insurance law it has been reviewed in The Guernsey law does not distinguish between insurance and reinsurance activities. This allows the regulator to be flexible and to consider each licence application on its merits instead of being constrained by the law. 7

10 Guernsey - Insurance Regulation Guernsey enjoys an enviable reputation as one of the world s leading offshore financial centres. It is the largest captive insurance domicile in Europe with a highly experienced insurance market which is involved in many different and innovative types of insurance business including protected cell companies (PCC's) and incorporated cell companies (ICC's), special purpose vehicles (SPV's) for insurance securitisation transactions, transformer vehicles for converting non-insurance risks into insurance products, life reinsurance, fronting arrangements and other insurance and reinsurance transactions. The Risk-based Approach to Supervision Wherever possible the Commission supervises on a risk based approach. Guernsey has the freedom to set its own minimum capital requirements, which can be lower than those required by the EU. The Commission however imposes a minimum margin of solvency on each company requiring licensees to maintain sufficient funds to cover their claims reserves together with a prudential margin, which the Commission has the power to vary depending on the quality of risk assessment and capital management, which the licensee has in place. The Commission will consider all minimum margins of solvency on a case-by-case basis, and reviews all the risks associated with a licensee in determining the appropriate level to set, considering both historical performance and prospective activity. Details of the law and regulations for insurance business can be found on the website but the risk-based approach and flexibility can only be experienced at first hand. Innovative Insurance Vehicles in Guernsey One of the hallmarks of regulation in Guernsey is its innovative approach. This is illustrated by the fact that ten years ago the Guernsey insurance market was the first in the world to introduce PCC legislation, alongside traditional companies, to expand the range of corporate vehicles, which could operate as insurance carriers. The Commission pioneered the regulation of PCC's and Cells, and supervision of PCC s extends to cellular level. Cells within PCC s can be used as SPV's for reinsurance transactions, and are a cost effective and flexible way to engineer, in a short timeframe, a suitable vehicle for such transactions. Since 2006, Guernsey has also introduced legislation, allowing each cell to be a separately incorporated corporate entity the Incorporated Cell Company (ICC). 8

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12 The JLT Difference 10 Our integrated approach to insurance management develops directly from the business philosophy of JLT, which can be summed up simply as putting our clients first. Everything we do is contingent on advancing our customers business interests and on building long-term partnerships with them. In turn, our clients tell us that the JLT difference lies in the quality of our: teamwork transparency and accountability administrative efficiency technical skills and creativity A very high proportion of our staff have leading qualifications in insurance or finance or business administration. Some have all three. We attract the best people because we give them the encouragement and opportunity to think creatively as business managers. We also support our professional teams and clients with web-based management systems that are at the cutting edge of technology. Every measure is taken to ensure competitive advantage for our clients and compliance with the laws and regulations of their chosen domicile. We believe that our reputation for providing a market-leading strategic insurance management service depends on the active involvement of our most senior people who are in day-to-day contact with our clients. JLT Insurance Management (Guernsey) Limited is a member of the Jardine Lloyd Thompson group of companies, a leading risk management adviser, insurance and reinsurance broker and provider of employee benefit administration and consultancy services. Jardine Lloyd Thompson Group plc is quoted on the London Stock Exchange and is the largest Europeanheadquartered company providing these services.

13 IMAGE AREA Pull quote text here. This box should sit over an image and be filled with 100% pantone 289 at a 75% opacity Our Services JLT s range of captive and insurance management services on the island include: Licensing and formation Assistance with licence application to the GFSC The selection of local professionals to act as directors Appointment of auditors, bankers, solicitors, etc. Provision of registered office Underwriting and claims Underwriting to fulfil risk-financing strategy Preparation of all policy documentation Purchase of reinsurance Claims handling and settlement Maintaining underwriting statistics Finance and accounting Maintaining company books Provision of management and operating accounts Placing of investments or liaising with investment manager Liaising with external auditors on report and accounts Payment and receipt of premiums Claims and reinsurance premium payments Solvency margin calculations Monitoring of collateral requirements. Reporting and Secretarial Co-ordination of board meetings and provision of facilities Preparation of board packs Management reporting Financial statements and regulatory reporting Secretarial support Consultation Feasibility studies Programme design and business strategy Efficiency reviews. 11

14 For insurance and reinsurance companies wishing to establish a presence in Guernsey, we can provide high quality and seamless back office accounting, underwriting and claim administration and IT services. In many cases, for companies establishing a permanent presence in Guernsey, the outsourcing of back office functions for the new operation is essential to allow the key individuals of the business the underwriters to hit the ground running and drive the business forward without the burden of many administrative and operational issues. Establishing a back office function for a new Guernsey operation can be time consuming and expensive and can divert valuable resources away from the core business objectives. Like many businesses, insurers and reinsurers see outsourced administration as a key strategy to transform business functions and gain competitive advantage by cost reduction, whilst focusing on core competencies. 12

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16 JLT Insurance Management (Guernsey) Limited PO Box 155, Mill Court La Charroterie St Peter Port Guernsey GY1 4ET JLT Insurance Management is a trading name of JLT Insurance Management (Guernsey) Limited. JLT Insurance Management (Guernsey) Limited is a member of the Jardine Lloyd Thompson Group. Regulated by the Guernsey Financial Services Commission. PO Box 155, Mill Court, La Charroterie, St Peter Port Guernsey, GY1 4ET. Registered in Guernsey Number: July Contact: Nick Wild Nick.Wild@jltgroup.com Telephone