Insurance Order, 2006 · As enacted
16. Deposits
Official textFrom Attorney General's Chambers, unchanged
An insurer, while registered in respect of any class of insurance business, shall at all times have in respect of that class of business a deposit with the Authority of such amount as may be prescribed.
insurance business
"insurance business" includes the business of effecting and carrying out contracts {a} protecting persons against loss or liability to loss in respect of risks to which such persons may be exposed; or {b) to pay a sum of money or render money and includes reinsurance business;
Any such deposit shall be in cash or in Government Securities or such other securities as may be prescribed.
All income accruing in respect of a deposit shall be payable to the insurer making the deposit.
A deposit made under this section in respect of any class of business shall be retained by the Authority until either the insurer ceases to be registered in respect of that class of insurance business or the deposit is required in the winding-up of the affairs of the insurer; and if the insurer ceases to be so registered, the deposit or part of it may be further retained for the purpose of and in accordance with any such provision for liabilities in respect of policies as is required by subsection (4) of section 13.
Authority
"Authority" means such person as is appointed by His Majesty the Sultan and Yang Di-Pertuan under subsection 11) of section 4 to be the Authority for the purposes of this Order;
If at any time a deposit under this section (other than a deposit retained after the insurer has ceased to be registered) comprises assets other than
Government Securities, and the value of those assets is less than the sum prescribed by virtue of subsection (1), the Authority may by notice in writing direct the insurer to add thereto within 28 days of the service of the notice, cash or security of a value not less than the difference.
An insurer which has made a deposit under this section may at any time substitute for any assets comprised in the deposit, cash or securities as may be prescribed so long as the value of the deposit is not thereby reduced to an amount below that which is required by this Order.
In the foregoing subsections, .. securities.. (except in the expression 11Government Securities 11
) includes any form of investment, and .. Government
Securities .. means securities of which the principal or interest is charged directly or by way of guarantee on the Consolidated Fund; but no deposit shall include-
(a}
any shares in, or debentures or other securities of, an insurer registered under this Order;
except so far as a debt comprised in the deposit is secured on land, any estate or interest in land; or 1008
{c) any securities authorised in the Third Schedule which the
Authority declares in writing to the insurer to be unsuitable for the purposes of a deposit.
Where by virtue of paragraph {c) of subsection (7) any securities comprised in a deposit have been declared unsuitable, the insurer shall within one calendar month of the securities being so declared substitute therefor such other securities as are authorised by this section.
Terms defined in s 2
Authority
Defined · s 2"Authority" means such person as is appointed by His Majesty the Sultan and Yang Di-Pertuan under subsection 11) of section 4 to be the Authority for the purposes of this Order;
insurance business
Defined · s 2"insurance business" includes the business of effecting and carrying out contracts {a} protecting persons against loss or liability to loss in respect of risks to which such persons may be exposed; or {b) to pay a sum of money or render money and includes reinsurance business;