Captive Insurance Company
The Financial Services Act 2007 lays out the framework to facilitate the establishment of Captive Insurance Business. Applicants for Captive Insurance licenses are companies with a GBL 1 License authorized and licensed by the FSC. Captive Managers have been licensed to provide specialised services in the area of captive insurance.
Regulation
Both pure Captives and Captives insuring second party and third party risk may be licensed. In the case of third party business the Captive should demonstrate access to the necessary underwriting analytical skills, financial soundness and a good track record. Full details of all programs to be underwritten must be submitted for approval to the FSC. Rent-a-captive and cell Captives are also permitted. A Captive Insurance Company must obtain a license to conduct Captive business. The Captive Insurance Company may also have to appoint a licensed Management Company (such as Inter-Ocean Management Limited) in Mauritius, which will also be regulated by the Commission and a Principal Representative who will be accountable to the Commission.
Key Regulatory Parameters
Captive Insurance Business in Mauritius is governed by the Insurance Regulations 2007.
Captive General Insurance Business
- Minimum paid-up Capital: US $100,000
- Margin of Solvency: surplus of assets over liabilities of US $100,000 or 15% of net premium income, whichever is higher
- Liquidity Ratio: The value of the captives admitted assets must not be less than 75% of the amount of its admitted liabilities
Captive Long Term Insurance Business
- Minimum Paid-Up Capital: US $250,000
- Margin of Solvency: Liabilities not to exceed amount of long term insurance fund
Captive General and Long Term Insurance Business
- Minimum Paid-Up Capital: US $350,000
Admitted Assets
The range of admitted assets includes accounts receivable net of bad debts, including loans to related companies provided prior approval is granted by the Commission , and letters of credit issued by recognised banks.
Reinsurance
Captive Insurance Companies are required to be reinsured in excess of reasonable and prudent retention levels unless the Commission is satisfied that the captive has access to sufficient security without the need for reinsurance.
Reporting
The Commission requires the annual filing of:
- Audited financial statements
- Certificate of margin of solvenc
- Certificate of liquidity ratio
- Actuarial valuation of adequacy of premiums and loss reserves for long term business
- Declaration of Principal Representative as to accuracy of accounts
Forming a Mauritian Captive
An application to form a Captive Insurance Company should be submitted to the FSC.
Applications must be submitted through an OMC and should be made on a prescribed application forms and accompanied by:
1. A certificate from a law practitioner practicing in Mauritius to the effect that the application complies with the Laws of Mauritius.
2. A copy of the Memorandum and Articles of Association of the Company or other constitutive documents together with the prescribed statutory forms.
3. Name of the Principal Representative who shall be an executive of the appointed Captive Management Company.
4. A Business Plan.
5. Actuarial report for long term licenses, which certifies that:
- The financing of the Captive is sufficient to cover both technical reserves and the required margin of solvency
- The Business Plan is actuarially sound as it relates to long term business
- The name of the appointed Captive Management Company
