Guidelines for Licensing Insurance Loss Assessors and Adjusters in Malawi

December 19 Page 1 of 14 REGISTRAR OF FINANCIAL INSTITUTIONS GUIDELINES FOR THE APPLICATION OF A LICENCE FOR AN INSURANCE LOSS ASSESSOR/ADJUSTER IN MALAWI (Financial Services Act and Insurance Act) FINANCIAL SECTOR REGULATION DEPARTMENT

2 PART I - PRELIMINARY

1. INTRODUCTION The Registrar of Financial Institutions (‘the Registrar”) is responsible for licensing and regulation of insurance loss assessors/adjusters. In line with the provisions of the Financial Services Act, 2010 and the Insurance Act 2010, the Registrar has issued these Licensing Guidelines to facilitate processing of applications for a licence to operate as an insurance loss assessor/adjuster. The Guidelines are intended to provide guidance on the licensing criteria for applicants applying for an insurance loss assessor/adjuster’s licence or licence renewal. These Guidelines should be read in conjunction with the provisions of the Financial Services Act 2010, the Insurance Act 2010 and any subsidiary legislation made under the Acts.
2. DEFINITIONS In these Guidelines, unless the context otherwise requires: “Applicant” means a person or entity applying for licensing as an insurance loss assessor or an insurance loss adjuster under these Guidelines; “Loss adjuster” means a person who possesses knowledge and skill to assess the accident and adjust compensation to the injured persons; “Loss assessor” means a person who assesses accidents on behalf of the insurer; “Principal officer” means an individual responsible for management of the affairs of the loss assessor/loss adjuster; “Registrar” means the Registrar of Financial Institutions appointed under the Financial Services Act, 2010; “Renewal period” means a period between 1 January and 31 January when applications for renewal of licence may be made to the Registrar.

PART II: APPLICATION PROCEDURES 1.0 An application for a licence to conduct business as an insurance loss assessor or loss adjuster shall be made by completing the application form provided in Appendix I.

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2.0 An applicant should not leave any requirements blank or unanswered. If a response to any requirement is ‘no’, ‘none’, ‘not applicable’ or ‘not known’ it must be so stated and an explanation provided, where necessary. 3.0 The application must be supported by information outlined in Part III. An application which does not contain all the information as required in Part III shall be deemed incomplete and will not be processed. 4.0 Submitting inaccurate or misleading information will result in an outright rejection of the application. 5.0 The Registrar may, in his discretion, require further information to support processing of the application. 6.0 An application shall be accompanied by a non-refundable licence assessment fee of Seventy Five Thousand Kwacha only (K75, 000.00) payable to the Reserve Bank of Malawi. 7.0 The application must be duly signed by the applicant(s) and must provide details of a contact person formally designated by the applicant(s) to act on its behalf on matters connected to the application. All communication between the Registrar and the applicant(s) will be conducted through the contact person provided. 8.0 The application must be submitted to the following address: - The Registrar of Financial Institutions Reserve Bank of Malawi P O Box 30063 Capital City LILONGWE 3 PART III: LICENSING REQUIREMENTS 1.0 An applicant for an insurance loss assessor or loss adjuster must provide evidence of the form of business organization in which it operates. The evidence may include a certificate of incorporation, partnership deed or business registration certificate. 2.0 The registered name of the applicant must include the words “Insurance Loss

4 Assessor or Loss Adjuster”. 3.0 The application for licensing should be accompanied by a business plan which should include, among other things, a three-year financial projection of statement of financial position, statement of comprehensive income and underlying assumptions. 4.0 The proposed insurance loss assessor or adjuster must have a principal officer who has at least five years of relevant work experience. The principal officer of – 4.2 an insurance loss assessor must have a minimum qualification of a Diploma obtained from the Chartered Institute of Insurance of the United Kingdom or any similar relevant professional qualification acceptable to the Registrar. 4.3 an insurance loss adjuster must have a minimum qualification of a Diploma obtained from the Insurance Loss Adjusters Institute of the United Kingdom or any similar relevant professional qualification acceptable to the Registrar. 5.0 The applicant will be required to effect a professional indemnity insurance policy with minimum coverage of Fifteen Million Kwacha only (K15,000,000.00). Evidence of cover must be submitted with the application. 6.0 The applicant shall not seek to be licensed under a name identical with the name of another insurance entity or so nearly resembling the name of another insurance entity already licensed under this Act or the Financial Services Act. 7.0 The applicant must have entered into a valid working arrangement with an insurer or a number of insurers. 8.0 The applicant must not have been convicted by any court of an offence involving dishonesty and does not otherwise have a criminal record. 9.0 The applicant must not have an adverse credit history. PART IV: APPROVAL PROCESS For purposes of licence application, an applicant must submit the following:-

5 1.0 a certified true copy of the incorporation certificate, partnership deed, or business registration certificate, whichever is applicable; 2.0 ownership structure of the applicant showing names, profession/business of proposed investors including beneficial owners, and percentage of shareholding, whichever is applicable; 3.0 bio-data/résumé and certified true copies of educational and/or professional certificates of owners; 4.0 organisational structure showing functional units and reporting relationships; 5.0 a copy of the bio-data/résumé of the insurance loss assessor or loss adjuster’s principal officer; 6.0 certified true copies of educational and professional certificates for the principal officer; 7.0 the applicant’s Business Plan. The plan must cover the services to be rendered, strategy, as well as implementation plan; 8.0 the applicant’s three (3) year financial projection plan comprising statement of financial position, statement of comprehensive income and underlying assumptions; 9.0 evidence of agreement(s) with insurers; 10.0 credit reference report issued by licensed credit reference bureau; 11.0 Police clearance report. PART V: LICENCE RENEWAL REQUIREMENTS 1.0 A licence to operate as an insurance loss assessor/adjuster shall expire on 31 March every year and shall be required to be renewed. 2.0 An application to renew a licence to operate as an insurance loss assessor/adjuster may be submitted to the Registrar between 1 January and 31January of each year.

6 3.0 An application shall be accompanied by a non-refundable licence renewal fee of Twenty Thousand Kwacha only (K20,000.00) payable to the Reserve Bank of Malawi. 4.0 Any submission received by the Registrar after 31January shall attract a penalty fee of K10,000.00 (Ten Thousand Kwacha) and thereafter K5,000.00 (Five Thousand Kwacha|) for each additional month of non-renewal. An insurance assessor or adjuster who does not wish to renew its licence must inform the Registrar within the renewal period of the intention not to renew. 5.0 An application to renew a licence shall be submitted to the Registrar in the format prescribed under Appendix II. 6.0 An application to renew licence shall be supported by documents indicated in Part III above. 7.0 Any application made after 1April shall be considered as a new application. ENQUIRIES Enquiries concerning the preparation, submission and status of an application should be addressed to: The Director Financial Sector Regulation Department Reserve Bank of Malawi P O Box 565 BLANTYRE E-mail: fsr@rbm.mw The licensing requirements, other guidelines and relevant forms can be downloaded from the Reserve Bank of Malawi’s website: http://www.rbm.mw

7 APPENDIX I APPLICATION FORM

1. Name of applicant:

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2. Mailing address:

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3. Phone no(s): Fax no: E - mail:

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4. Location of offices: i. Head office (provide physical address)

ii. Branches

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5. Indicate legal form of the applicant (sole proprietorship, partnership, body corporate)

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6. List names of the shareholders, indicating their addresses, nationality, and their capital account contributions.

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7. Principal officer: i. Name of individual designated as principal officer.

8 ii. Provide details regarding his/her professional and educational qualification.

iii. Provide details regarding his/her employment history, including positions held and level of managerial experience.

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8. Provide name, address and account number of the proposed insurance loss assessors/adjusters’ Bankers.

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9. Does the applicant or any of the promoters of the applicant carry on any business or have an interest in any business other than the insurance loss assessor/adjuster business? If yes, give full details, including the name of the business, its address, and the nature of its business?

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10. Other information: i. Has the applicant (s), or any affiliate of the applicant ever been refused a licence under the Financial Services Law or under the laws of any other jurisdiction which required such licensing, or has any such licence been suspended or cancelled? (if yes, please provide details). ii. Provide details if any of the shareholder(s) has ever been: a. charged or convicted under the Laws of Malawi or any other country; b. a defendant in any proceedings in any civil court or tribunal in any country where fraud, theft, misrepresentation, negligence or other similar conduct was alleged; c. declared bankrupt or made a voluntary assignment in bankruptcy, or been subject of proceedings relating to insolvency, dissolution or winding up of business;

9 d. a recipient of a judgement or garnishment in any civil court in any country; e. refused professional indemnity insurance or a fidelity bond or ever had any of such insurance cancelled. iii. Is there any person or entity, whose name is not disclosed in this application who has any direct or indirect beneficial interest in the applicant?

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11. Insurance markets: i. List all classes of insurance business to be served by the insurance loss assessor/adjuster. ii. Has the applicant’s contract agreement with any insurance company been cancelled in the past three years? (If yes, please outline the reasons for the cancellation)

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DECLARATION With regard to APPLICATION FOR LICENCE TO CONDUCT BUSINESS AS AN INSURANCE LOSS ASSESSOR/ADJUSTER We, the undersigned, do hereby certify that: i) all the information given in response to and in support of the questions in this application is true and correct to the best of our knowledge and belief; and ii) this application is made in good faith with the purpose and intent that affairs and business of the proposed insurance loss assessor/adjuster will at all times be honestly conducted in accordance with good and sound business principles and in full compliance with all applicable laws and regulations. We further certify that to the best of our knowledge and belief there are no other facts or information relevant to this application of which the Registrar should be aware, and we pledge to promptly inform the Registrar of any material change to this application which may arise while it is being considered. NAME SIGNATURE TITLE/POSITION Date:……………………………..

11 APPENDIX II LICENCE RENEWAL APPLICATION FORM

1. Name of applicant:

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2. Mailing address:

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3. Phone no(s):

Fax no:

E - mail:

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4. Location of offices: i. Head office (provide physical address)

ii. Branches

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5. Indicate legal form of the applicant (sole proprietorship, partnership, body corporate)

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6. A list of all the partners, their addresses, nationality, and their capital account contributions.

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7. Principal Officer: i. Name of individual designated as principal officer.

12 ii. Provide details regarding his/her professional and educational qualification.

iii. Provide details regarding his/her employment history, including positions held and level of managerial experience.

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8. Provide name, address and account number of the insurance loss assessor/adjusters’ Bankers.

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9. Does the applicant or any of the promoters of the applicant carry on any business or have an interest in any business other than the insurance loss assessor/adjuster business? If yes, give full details, including the name of the business, its address, and the nature of its business?

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10. Other information: i. Has the applicant (s), or any affiliate of the applicant ever been refused a licence under the Financial Services Law or under the laws of any other jurisdiction which required such licensing, or has any such licence been suspended or cancelled? (if yes, please provide details). ii. Provide details if any of the shareholder(s) have ever been: a. charged or convicted under the Laws of Malawi or any other country. b. a defendant in any proceedings in any civil court or tribunal in any country where fraud, theft, misrepresentation, negligence or other similar conduct was alleged. c. declared bankrupt or made a voluntary assignment in bankruptcy, or been subject of proceedings relating to insolvency, dissolution or winding up of business.

13 d. a recipient of a judgement or garnishment in any civil court in any country. e. refused professional indemnity insurance or a fidelity bond or ever had any of such insurance cancelled. iii. Is there any person or entity, whose name is not disclosed in this application who has any direct or indirect beneficial interest in the applicant?

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11. Insurance markets: i. List all classes of insurance business to be served by the insurance loss assessor/adjuster. ii. Has the applicant’s contract agreement with any insurance company being cancelled in the past three years? (If yes, please outline the reasons for the cancellation)

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14 DECLARATION With regard to APPLICATION TO RENEW LICENCE TO CONDUCT BUSINESS AS AN INSURANCE LOSS ASSESSOR/ADJUSTER We, the undersigned, do hereby certify that: i) all the information given in response to and in support of the questions in this application is true and correct to the best of our knowledge and belief; and ii) this application is made in good faith with the purpose and intent that affairs and business of the proposed insurance loss assessor/adjuster will at all times be honestly conducted in accordance with good and sound business principles and in full compliance with all applicable laws and regulations. We further certify that to the best of our knowledge and belief there are no other facts or information relevant to this application of which the Registrar should be aware, and we pledge to promptly inform the Registrar of any material change to this application which may arise while it is being considered. NAME SIGNATURE TITLE/POSITION Date:……………………………..