ARRANGEMENT OF SECTIONS
1. Short title
Establishment of Regulatory Authority
4. General duties of regulatory authority
5. - 6. ......
7. Exemption from liability for damages
Licensing of International Insurance Firms
9. Application for a licence
10. Decision on application for a licence
11. Register of International Insurance Firms
Regulation of International Insurance Firms
13. Code of practice
14. Directions by the regulatory authority
15. Application to vary or rescind a direction
16. Order to enforce compliance with a condition or direction
16A. Application of certain sections
17. Auditors of international insurance firms
18. Acquiring transactions and disposals
Revocation of Licence and Winding Up
19. Revocation of licence
20. Winding up on application to High Court
Enforcement and Miscellaneous Provisions
21. Appointment of authorised officers
22. Powers of authorised officers
23. Search with warrant
24. Search without warrant in certain cases
25. Exercise of powers under section 22
26. Penalty for hindering or interfering with authorised officer
27. Enforcement powers of authorised officers
28. Offences relating to documents
29. Offences punishable by court
30. Contraventions punishable by regulatory authority
31. Guidelines and directions by regulatory authority
Act 5, 2005,
Act 2, 2007,
S.I. 54, 2008.
An Act to make provision for licensing to carry on international insurance business and the supervision of international insurance firms and other matters connected therewith.
[Date of commencement: 16th June, 2008]
Preliminary (ss 1-2)
This Act may be cited as the International Insurance Act.
(1) In this Act, unless the context otherwise requires-
"accountant" has the same meaning as in the Accountants Act;
"applicant international insurance firm" means an undertaking that applies, under section 9, for a licence to operate as an international insurance firm;
"auditor" means an accountant who holds a current practising certificate in terms of section 19 of the Accountants Act and who is approved by the regulatory authority;
"authorised officer" means a person appointed, under section 21, to be an authorised officer;
"captive insurance business" means insurance business where the insured is a holding or affiliated company of the licensed insurer or is a person in respect of whom the licensed insurer is licensed by the regulator to provide insurance;
"controller", in relation to an international insurance firm, means a director or any person entitled to exercise or control the exercise of one third or more of the votes at any general meeting of the international insurance firm;
"code of practice" means a code of practice issued by the regulatory authority under section 13;
"condition" means a condition of a licence imposed under section 10 or 12;
"direction" means a direction issued by the regulatory authority under section 14 (1);
(a) any person occupying the position of director;
(b) any person who effectively directs or has a material influence over the business of an international insurance firm; and
(c) any person in accordance with whose directions or instructions the directors of an international insurance firm are accustomed to acting;
"former international insurance firm" means an undertaking whose licence to operate as an international insurance firm has been revoked under section 14 (2);
"general insurance business" means insurance business other than long-term insurance business;
"insurance agent" means a person appointed by an insurer, and not being an employee of the insurer, to solicit applications for insurance or negotiate insurance on behalf of the insurer, and to effectuate and countersign insurance contracts;
"insurance business" means the business of effecting and carrying out contracts under which one party, the insurer, accepts an insurance risk by agreeing with another party, the policyholder, to compensate the policyholder or other specified beneficiary if a specified uncertain future event adversely affects the policyholder or other beneficiary (other than an event that is only a change in one or more of a specified interest rate, security price, commodity price, foreign exchange rate, index of process or rates, a credit rating or credit index or similar variable) and includes reinsurance, general insurance business and long-term insurance business;
"insurance manager" means a company operating in or from within Botswana which provides insurance expertise to or for insurers and which has, in its employment, a person who-
(a) is qualified as a fellow or an associate of the Insurance Institute of South Africa, the Chartered Insurance Institute of the United Kingdom or of some other professional insurance association recognised, by the Registrar of Insurance, by regulations, for the purposes of this Act, and who is a current member of good standing of such association; or
(b) is a person of good standing and has been approved by the regulator;
"insurer" means an undertaking that carries on insurance business;
"international insurance business" means the carrying on or the conducting, whether from within or outside Botswana, of any insurance business where each of the insured, the person to whom the policy moneys are payable and the owner of the policy or any one or more of such persons is not domiciled or ordinarily resident in Botswana and includes reinsurance and captive insurance business;
"international insurance firm" means an undertaking which carries on international insurance business and includes an insurance manager, a principal insurance representative and an insurance agent;
"international insurer" means an undertaking carrying on international insurance business;
"licence" means a licence granted under section 10.
"long-term business" means insurance business of any of the following kinds, namely-
(a) effecting and carrying out contracts of insurance on human life or contracts to pay annuities on human life;
(b) effecting and carrying out contracts of insurance against risks of the persons insured sustaining injury as a result of an accident or of an accident of a specified class, or dying as a result of an accident or of an accident of a specified class, or becoming incapacitated in consequence of disease or disease of a specified class, being contracts that are expressed to be in effect for a period of not less than five years or without limit of time and either not expressed to be terminated by the insurer before the expiration of five years from the taking effect thereof or are expressed to be so terminable before the expiration of that period only in special circumstances therein mentioned;
(c) effecting and carrying out contracts of insurance, whether effected by the issue of policies, bonds or endowment certificates or otherwise, whereby in return for one or more premiums paid to the insurer a sum or a series of sums is to become payable to the persons insured in the future, not being contracts such as fall within either paragraph (a) or
(b) of this definition; and
(d) any kind of insurance business declared by regulations to be long- term business;
"officer", in relation to an international insurance firm, means a controller, chief executive officer, manager or secretary;
"principal insurance representative" means a person operating in or from within Botswana, who, on his or her own account and not as the employee of another person, maintains, for an insurer, full and proper records of the business activities of that insurer;
"Register" means the Register of International Insurance Firms;
"Regulatory Authority" means the Regulatory Authority established by the Non-Bank Financial Institutions Regulatory Authority Act;
"reinsurance" means the form of insurance where the primary insurer reduces the risk by sharing individual risks or portfolios of risks with a reinsurer against a premium; and
"undertaking" means a body corporate, a partnership, an unincorporated body of persons or a sole trader.
(2) For the purposes of this Act, references to books, records or other documents, shall be construed as including any document or information kept in a non-legible form (whether stored electronically or otherwise) which is capable of being reproduced in a legible form and all the electronic or other automatic means, if any, by which such document or information is capable of being reproduced and to which the person whose books, records or other documents are inspected for the purposes of this Act, has access.
Establishment of Regulatory Authority (ss 3-7)
The regulatory authority shall administer the system of regulation and supervision of international insurance firms in accordance with the provisions of this Act in order to promote-
(a) the maintenance of the proper and orderly regulation and supervision of international insurance firms; and
(b) the best economic interests of Botswana.
(1) . . . . . .
(2) The licence, supervision, regulation or revocation of a licence of an international insurance firm under this Act shall not constitute a warranty as to the solvency or performance of an international insurance firm, and neither the State nor the regulatory authority shall be liable in respect of any loss or losses incurred through the insolvency, default or performance of the international insurance firm.
Licensing of International Insurance Firms (ss 8-11)
(1) An undertaking operating within or from Botswana that intends to carry on international insurance business within or outside Botswana shall apply to the regulatory authority for a licence to do so.
(2) An application under subsection (1) shall be in the prescribed form.
(3) The regulatory authority may, at any time prior to granting or refusing to grant a licence, request further information from the applicant international insurance firm concerned and the applicant international insurance firm shall provide the information requested.
(4) The regulatory authority may, at any time prior to the granting or refusing to grant a licence, commission an independent assessment of the capacity of the applicant international insurance firm to engage in the activity for which it seeks a licence.
(5) An applicant international insurance firm that applies for a licence under this section using false or misleading information, or making false or misleading statements, in the course of, or in relation to, an application for a licence shall be guilty of an offence.
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