CHAPTER 84:01
INSURANCE ACT
An Act to revise and consolidate the law providing for
the regulation of insurance business and for other purposes related to or connected
with such business and for the regulation of privately administered pension
fund plans.
[1st November 1982]
1. This Act
may be cited as the Insurance Act.
2. (1) This Act applies to—
(a) all
companies, whether or not established in Trinidad and Tobago, which carry on in
Trinidad and Tobago insurance business of all or any of the classes specified
in the First Schedule;
(b) privately
administered pension fund plans whether administered by individual trustees or
by trust corporations.
(2) For the purposes of this Act the
reinsurance of liabilities under insurance policies shall be treated as
insurance business of the class to which the policies would have belonged had
they been issued by the reinsurer, and all the provisions of this Act shall apply
to such reinsurance save that a company or an association of underwriters
carrying on such reinsurance shall not be required to make in respect thereof
the deposit required to be made by section 29 or section 189.
(3) Notwithstanding anything in any other
written law for the purpose of this Act an insurance business may be carried on
in any currency.
PRELIMINARY
3. (1) In this Act—
“actuary” means a
Fellow by examination of the Institute of Actuaries in England, of the Faculty
of Actuaries in Scotland or of the Society of Actuaries in the United States of
America or an actuary possessing such other qualifications as may from time to
time be approved by the Central Bank;
“adjuster” means
any person who for compensation, a fee, a commission or a salary investigates
and negotiates settlement of claims arising under insurance contracts, solely
on behalf of either the insurer or the insured, but does not include—
(a) a
salaried employee of an insurer while acting on behalf of such insurer in the
adjustment of losses; or
(b) an agent
of an insurer;
“admissible
assets” means such assets as may from time to time be prescribed to be
admissible assets;
“agent” means any
individual, firm or company appointed by an insurer to solicit applications for
insurance or negotiate insurance business on its behalf and, where authorised
to do so by the insurer, to effectuate and countersign insurance contracts, but
does not include an individual who is an employee of the insurer;
“approved
securities” means such securities as may from time to time be prescribed
to be approved securities;
“assets” does not
include goodwill;
“assignment” in
relation to a policy, does not include a surrender of the policy to the company
liable under the policy;
“association of
underwriters” means an association of individual underwriters organised
according to the system known as Lloyd’s whereby every underwriting
member of a syndicate becomes liable for a separate part of the sum secured by
each policy subscribed to by that syndicate limited or proportionate to the
whole sum thereby secured;
“Board” means the Board of Directors of
the Central Bank as constituted and appointed under setions 5 and 7,
respectively, of the Central Bank Act;
“broker” means any individual who or any
firm or company which for compensation as an independent contractor in any
manner solicits, negotiates or procures insurance or the renewal or continuance
thereof on behalf of existing or prospective policyholders;
“carrying on insurance
business” includes the receipt of proposals for or the issuing of
policies of insurance in Trinidad and Tobago or the collection or receipt in
Trinidad and Tobago of renewal premiums on policies issued in Trinidad and
Tobago by an insurer or through an agent or as an agent but does not include—
(a) the
collection or receipt in Trinidad and Tobago of renewal premiums under a policy
issued outside of Trinidad and Tobago to a person who is temporarily resident
in Trinidad and Tobago but at the date of issue of the policy was resident
outside of that country; or
(b) the
making of payments due under any such policy;
“Central Bank” or
“Bank” means the Central Bank of Trinidad and Tobago established
under section 3 of the Central Bank Act;
“chief executive
officer” means a person employed by an insurance company, who either
alone or jointly is, subject to any directions of the directors of the company,
responsible for the conduct of all the insurance business of the company;
“class” means any
class of insurance business specified in the First Schedule;
“company” means a
body corporate which carries on or proposes to carry on insurance business in
Trinidad and Tobago;
“controller”
means a director or a chief executive officer of a company or any person who is
entitled to control at least one‑third of the voting power at any general
meeting of the company; a controller of a company which has an insurance
company as a subsidiary shall be deemed to be a controller of the insurance
company;
“Court” means a
Court of competent jurisdiction;
“financial year”
in relation to an insurer, means each period not exceeding twelve months at the
end of which the balance of the accounts of the insurer is struck;
“foreign company” means a company which is
incorporated outside of Trinidad and Tobago;
“general insurance
business” means insurance business of any class other than long‑term
insurance business;
“Governor” means the Governor of the
Central Bank appointed pursuant to section 7 of the Central Bank Act;
“industrial
policy” means a policy in respect of which the premiums are contracted to
be paid at intervals of less than two months and are contracted to be received
by means of collectors and includes—
(a) a policy
which at any time was an industrial policy; and
(b) a paid‑up
policy, not being a policy expressed to be an ordinary policy granted in lieu
of an industrial policy or of a policy referred to in paragraph (a);
“Inspector” means
the Inspector of Financial Institutions appointed pursuant to section 30 of the
Financial Institutions Act;
“insurance
business” means the business of or in relation to the issue of or the
undertaking of liability under policies to make good or indemnify the insured
against any loss or damage including liability to pay damages or compensation
contingent upon the happening of a specified event in the currency in which the
premium had been paid, but does not include—
(a) business
in relation to the benefits provided by a friendly society or a trade union for
its members or their dependents; or
(b) business
in relation to a scheme under which superannuation benefits, pensions or
payments to employees or their dependents on retirement, disability or death
are provided by an employer, or his employees, or by both, wholly through an
organisation established solely for those purposes by the employer or his
employees, or by both;
“insurer” means a
company registered to carry on insurance business in Trinidad and Tobago and
includes an underwriter and an association of underwriters, but does not
include an insurance agent as such nor, where an insurance agent is also an
insurer, it does not refer to that part of his business done as an insurance
agent;
“local company”
means a company incorporated under the Companies Act or any other written law;
“long‑term
insurance business” includes insurance business of all or any of the
following classes:
(a) ordinary
long‑term insurance business;
(b) industrial
life insurance business; and
(c) in
relation to any company, insurance business carried out by the company as
incidental only to either of the classes of business referred to in paragraphs (a) and (b);
“Minister” means
the Minister to whom responsibility for the subject of Finance is assigned;
“mutual company”
means a company whose capital is owned by the policyholders of the company;
“officer”
includes the manager, secretary, treasurer, actuary or any other person
designated as an officer of a company by its Articles of Association, its Bye‑laws
or any Rules regulating its operation;
“paid‑up
policy” means a policy under which no future premiums are required;
“policy” means
any written contract of insurance whether contained in one or more documents;
“policyholder”
means the person who for the time being has the legal title to the policy and
includes any person to whom a policy is for the time being assigned;
“policy in Trinidad and
Tobago” means in relation to—
(a) long‑term
insurance business, a policy issued or effected by a company registered under
this Act upon the life of a person for the time being resident in Trinidad and
Tobago;
(b) property
insurance business, a policy issued or effected by a company registered under
this Act upon property situated in Trinidad and Tobago; and
(c) any other
class of insurance business, a policy issued or effected by a company
registered under this Act where the risks covered by the policy are ordinarily
situated in Trinidad and Tobago at the time the policy was issued;
“principal
representative” means a person appointed by a foreign company pursuant to
section 17;
“salesman” means an individual contracted by an insurer or
an agent to solicit applications for insurance or negotiate insurance on behalf
of the insurer or the agent, as the case may be;
“statutory fund”
in relation to a company means a statutory fund maintained by the company under
section 37;
“superannuation
allowances” includes payment of a lump sum on retirement;
“Trinidad and Tobago
policyholder” means the legal holder for the time being of a policy in Trinidad
and Tobago;
“underwriter”
includes any person named in a policy as liable to pay or contribute towards
the payment of the sum secured by the policy.
(2) For the purposes of this Act a person
shall not be treated as carrying on insurance business in Trinidad and Tobago
if the only reason for so treating the person is the fact that the risk covered
by a policy of insurance issued by such person is situated in Trinidad and
Tobago.
PART I
ADMINISTRATION
4. (1) With effect from the commencement of the
Insurance (Amendment) Act, 2004, the Central Bank shall be charged with the
administration of this Act.
(2) The Central Bank may, whenever it
considers it necessary, cause arrangements to be made for the services of an
actuary or any other competent person to be made available for the purpose of
advising the Bank on matters arising under this Act.
5. (1) With effect from the commencement of the
Insurance (Amendment) Act, 2004, the Inspector shall have the powers and duties
conferred on him by this Act.
(2) The Inspector may, by instrument in
writing, delegate to any person whom he sees fit, all or any of his powers or
duties under this Act except the power conferred on him by this subsection.
5A. The
Central Bank may appoint, upon such terms and conditions as it may think fit,
such persons as may be considered necessary to assist the Inspector in the
performance of his duties.
6. (1) The Central Bank may by instrument in
writing, delegate to any person whom it sees fit, all or any of its powers or
duties under this Act except the power conferred on it by this section.
(2) A delegation under subsection (1)—
(a) shall be
revocable at will and shall not preclude the Central Bank from exercising the
power or performing the duty which has been delegated;
(b) may be
made subject to a power of review and alteration, within such period as may be
specified in the instrument of delegation, by the Central Bank of any act done
in pursuance of the delegation.
7. (1) The Central Bank shall, within three
months after the thirty‑first day of December in each year, furnish to
the Minister for laying before Parliament—
(a) a report
on the working of this Act during the year; and
(b) printed
copies of summaries of the documents lodged with him under sections 56, 60,
113, 184, 185 and 191 during that year.
(2) The Bank may attach to any printed copies
of summaries furnished pursuant to subsection (1)(b) such comments on the document as the Bank thinks
necessary, together with a copy of any correspondence relating to the document.
(3) The Minister shall, as soon as possible
after receiving the report of the Bank and the printed copies of summaries,
cause a copy of the report and the printed copies of summaries to be laid
before Parliament.
(4) The Governor shall keep the Minister
informed of developments and activities, in Trinidad and Tobago which affect
insurance business.
8. (1) Subject to subsection (2), where in
relation to a policy, a dispute or difference arises between a company and a
policyholder, the Inspector may upon the written request of either party act as
arbitrator of the dispute or difference.
(2) An arbitration under this section shall
be conducted in accordance with the Arbitration Act.
9. The
Central Bank shall maintain such registers as may be required or authorised to
be maintained under this Act or the Regulations and in particular shall
maintain separate registers of—
(a) companies
which are registered to carry on the various classes of insurance business in
Trinidad and Tobago;
(b) privately
administered pension fund plans; and
(c) associations
of underwriters.
PART II
REGISTRATION
10. This
Part does not apply to a privately administered pension fund plan or to an
association of underwriters.
11. (1) Subject to this Act, no person may carry
on insurance business in Trinidad and Tobago unless that person is—
(a) a company
within the meaning of the Companies Act or any other written law; or
(b) a company
incorporated outside of Trinidad and Tobago which has an established place of
business in Trinidad and Tobago.
(2) A company referred to in subsection (1)
shall not carry on insurance business of any of the classes specified in the
First Schedule as insurer unless it is registered by the Central Bank in
respect of that class of business.
(2A) Subsection (2) shall not apply to a
company registered under this Act to carry on insurance business in Trinidad
and Tobago immediately before the 25th may, 2004.
(3)
(4) (Repealed by Act No. 15 of 2004).
(5)
(6) A company which contravenes the provisions
of this section is liable on summary conviction to a fine of ten thousand
dollars and in the case of a continuing offence to a further fine of one
thousand dollars for each day on which the offence is continued after
conviction therefor.
12. (1) A local company which is carrying on
insurance business in Trinidad and Tobago shall not—
(a) transact
insurance business in Trinidad and Tobago with an unregistered insurer;
(b) employ an
unregistered broker for the transaction of insurance business in Trinidad and
Tobago; or
(c) carry on
insurance business outside of Trinidad and Tobago without the prior approval of
the Central bank.
(2) For
the purposes of subsection (1)(c), the transaction of
insurance business does not include the ceding of insurance business to
reinsurers outside of Trinidad and Tobago.
(3) (Repealed by Act No. 15 of 2004).
(4) A company which contravenes the
provisions of subsection (1) is liable on summary conviction to a fine of five
thousand dollars.
13. (1) Subject to this Act, no company may be
registered to carry on ordinary long‑term insurance business unless it
has a paid‑up share capital of not less than three million dollars, such
capital to be fully paid‑up in cash, or in the case of a mutual company
unless it has uncommitted reserves of at least three million dollars.
(2) A company which immediately before the
commencement of this Act is registered to carry on ordinary long‑term
insurance business shall within two years of the commencement of this Act
increase its paid‑up share capital to not less than three million dollars
or, in the case of a mutual company increase its uncommitted reserves to at
least three million dollars.
(3) Notwithstanding the provisions of
subsection (1), a company which is carrying on both ordinary long-term and
industrial life insurance business shall be required to have a paid‑up
share capital of at least three million dollars, such capital to be fully paid‑up
in cash, or in the case of a mutual company, uncommitted reserves of at least
three million dollars.
(4) No company may be registered to carry on
any class of insurance business other than ordinary long‑term insurance
business, unless it has a paid‑up share capital of not less than one
million dollars, such capital to be fully paid‑up in cash, or in the case
of a mutual company unless it has uncommitted reserves of at least one million
dollars.
(5) A company which immediately before the
commencement of this Act is registered to carry on any class of insurance
business, other than ordinary long‑term insurance business, shall within
two years of the commencement of this Act increase its paid‑up share
capital to not less than one million dollars, or in the case of a mutual
company increase its uncommitted reserves to one million dollars.
(6) The provisions of subsections (1), (3)
and (4) shall not apply for a period of two years after the commencement of
this Act to any company which was registered to carry on any class of insurance
business immediately before the commencement of this Act in relation to such
class of insurance business.
14. (1) With effect from the 25th May, 2004, a
company may apply to the Central Bank for registration under this Act to carry
on insurance business.
(2) An application shall be made in the
prescribed form, shall be signed by a director in the case of a local company
and by its principal representative in the case of a foreign company and shall
specify—
(a) the
situation of the head office of the company;
(b) the names
of the directors and of the auditors and in the case of a foreign company the
names and addresses of its principal representatives;
(c) the name
of the actuary of the company in the case of a company seeking registration to
carry on long‑term insurance business;
(d) the
countries outside of Trinidad and Tobago, if any, in which the company carries
on insurance business; and
(e) the class
of insurance business which the company is carrying on or proposes to carry on.
(3) An application shall be accompanied
by—
(a) a copy of
the instrument establishing the company or any other duly certified proof of
incorporation;
(b) a copy of
the Memorandum of the company;
(c) a copy of
the Articles of Association or other Rules of the company;
(d) a copy of
the latest revenue account and balance sheet of the company prepared in
accordance with the prescribed forms and a copy of the latest actuarial
valuation report on the financial position of the company;
(e) details
of any reinsurance arrangements in respect of each class of insurance business
which the company proposes to carry on;
(f) except in
the case of a company carrying on insurance business immediately before the
commencement of this Act, a statement of projections of revenue and expenditure
for a period of at least three years, such statement to be prepared by an
actuary in the case of a company carrying on long‑term insurance
business;
(g) a
statement showing its nominal, subscribed and paid‑up capital and the
amount of the capital paid‑up in cash in the case of a company which has
shareholders;
(h) a copy of
the premium rate book in use or to be used by the company in Trinidad and
Tobago, in the case of a company carrying on or proposing to carry on long‑term
insurance business;
(i) specimens
of the various standard forms of proposals and policies to be used and issued
in Trinidad and Tobago;
(j) such
further information as the Central Bank considers necessary for the purpose of
determining whether or not the company is capable of complying with the
requirements of this Act.
15. (1) (Repealed by Act No. 15 of
2004).
(2) The Central Bank shall, where it is
satisfied that all the requirements of this Act governing registration have
been complied with, register the company as soon as practicable after receiving
the application.
(3) Where the Central Bank is not satisfied
that the requirements referred to in subsection (2) have been complied with the
Bank may grant to the company temporary registration for a period not exceeding
twelve months.
(4) Notwithstanding the provisions of
subsection (3), the Minister may, on the recommendation of the Central Bank and
where he is satisfied that the interest of Trinidad and Tobago policyholders so
requires, by Order extend the periods specified in that subsection to such period
as may be specified in the Order.
(5) A company which has not been registered
under this Act shall, so long as it continues to be under liability to Trinidad
and Tobago policyholders, comply with the provisions of sections 29 and 37 and
such other provisions of this Act as may be applicable to it.
16. Subject
to section 17, a company shall be registered where the Central Bank is
satisfied—
(a) that the
application for registration is made in accordance with the provisions of this
Act; and
(b) that the
company—
(i) is registrable under section 13; and
(ii) is likely to be able to comply with such
provisions of this Act as are applicable to it.
17. (1) A company shall not be registered in
respect of any class of insurance business unless the Central Bank is satisfied
that—
(a) the
company has made in respect of that class of insurance business the deposit
required to be made under section 29;
(b) the
company has made adequate arrangements for the reinsurance of that class of
insurance business or that there is no justification for making such
arrangements;
(c) the
managing director or controller of the company is a fit and proper person to
manage it or to be a controller thereof;
(d) in the
case of a company which is carrying on or proposes to carry on some other form
of business in addition to insurance business, the carrying on of that other
form of business is not or would not be contrary to public interest;
(e) in the
case of a foreign company it has appointed a person resident in Trinidad and
Tobago to be its principal representative in the country and has informed the
Central Bank of the name and address of that person;
(f) having
regard to the knowledge and competence of its manager and other officers, the
company is, in relation to that class of insurance business, capable of
carrying on such business efficiently; and
(g) that the
policy and practice of the company in dealing with claims are conducive to the
efficient and speedy settlement thereof.
(2) A company which applies for registration
to carry on general insurance business shall not be registered to carry on such
business unless, in addition to complying with the requirements of subsection
(1), it satisfies the Central Bank that the value of its admissible assets
exceeds the amount of its liabilities by at least two hundred and fifty
thousand dollars or twenty per cent of its general premium income net of
reinsurance premiums computed as at the end of its last financial year
whichever amount is the greater.
(3) Information regarding the knowledge and
competence of the manager and other officers of the company shall be submitted
to the Central Bank in such form as may from time to time be prescribed.
18. Service
of any notice, writ, summons or other document on the principal representative
of a foreign company shall be deemed to be service on the company of the
notice, writ, summons or other document.
19. (1) No insurance company may appoint a person
as its chief executive officer unless—
(a) the
company has served on the Central Bank a written notice—
(i) stating that it proposes to appoint
the person to that position; and
(ii) containing such particulars as may
be prescribed; and
(b) the
Central Bank has—
(i) notified
the company in writing that there is no objection to the appointment; or
(ii) failed to serve on the company a
written notice of objection within one month from the date on which the
company’s notice was served on the Bank.
(2) A notice served under subsection (1)(a) shall contain a statement signed by the person whom
the company proposes to appoint (hereinafter referred to as the “proposed
appointee”) to the effect that it is served with his knowledge and consent.
(3) Subject to subsections (4) and (5), the
Central Bank may serve a notice of objection on a company where it appears to
the Bank that the proposed appointee is not a fit and proper person to be
appointed to such a position.
(4) The Central Bank shall, before serving a
notice of objection on a company, serve on the company and on the proposed
appointee a preliminary notice stating that—
(a) the Bank
is considering the service on the company of a notice of objection on the
ground that it appears to the Bank that the proposed appointee is not a fit and
proper person to be appointed to such a position; and
(b) the
company and the proposed appointee may, within seven days from the date on
which the preliminary notice was served, make representations in writing to the
Central Bank.
(5) The Central Bank shall, before serving a
notice of objection, consider any representations made under subsection (4)(b).
20. (1) No person may become a controller of an
insurance company, except by virtue of an appointment in relation to which
section 19 applies, unless—
(a) he has
served on the Central Bank a written notice—
(i) stating that he intends to become a
controller of the company; and
(ii) containing such particulars as may
be prescribed; and
(b) the
Central Bank has—
(i) notified him in writing that there
is no objection to his becoming a controller of the company; or
(ii) failed to serve on him a written
notice of objection within a period of three months from the date on which the
notice referred to in paragraph (a) was
served on the Central Bank.
(2) The provisions of subsections (3), (4) and (5) of section 19 shall, with the
necessary adaptations, apply to this section.
21. Where a
person is appointed, becomes or ceases to be chief executive officer or
controller of a company, the company shall before the expiration of fourteen
days beginning with the day next following that on which the person has been
appointed, becomes or ceases to be its chief executive officer or controller,
give written notice of such fact to the Central Bank.
22. (1) The Central Bank shall issue to every
company registered under this Act a certificate to the effect that the company
has been so registered.
(2) A certificate issued under subsection (1)
shall—
(a) specify
the class of insurance business in respect of which the company is registered;
(b) be
subject to such conditions as the Central Bank may consider necessary to
impose; and
(c) be prima
facie evidence that the company named in
the certificate has been registered under this Act.
23. Where
subsequent to the registration of a company under this Act there is any
change—
(a) in the
particulars specified in the application of the company;
(b) in the
particulars of the documents required under section 14(3)(a) to (e) and (g) to (i) to accompany the application; or
(c) in any
further information which the company is required to furnish under section
14(3)(j),
the company shall, within
thirty days of such change, notify the Central Bank in writing of the change.
24. (1) Every company registered under this Act
to carry on any class of insurance business shall, at least one month prior to
the date of the issue of a new form of policy or of the use of a standard form
of endorsement or of a form of application for a policy, furnish the Central
Bank with a copy of the standard form of policy or of the standard form of
endorsement or of the form of application.
(2) The Central Bank may prohibit a company
from issuing or using a new form of policy, a standard form of endorsement or a
form of application for a policy the issue or use of which, in the opinion of
the Bank, is fraudulent, unjust or not in the public interest.
(3) A company which continues to issue or use
a form of policy, a standard form of endorsement or a form of application for a
policy the issue or use of which is prohibited by the Central Bank under
subsection (2) is guilty of an offence.
25. (1) A company which ceases to carry on
insurance business of a class in respect of which it is registered under this
Act shall immediately notify the Central Bank in writing to this effect and on
being so notified the Board shall subject to subsection (4) cancel the
registration of the company in respect of that class.
(2) Where a company is registered under this
Act and the Board reasonably believes that the company has not carried on
insurance business within a year of its registration or for a period of more than
one year the Board may serve on the company a notice requiring it to satisfy
the Board , within one month after the date of service of the notice, that it
is carrying on insurance business in Trinidad and Tobago.
(3) The Board may cancel the registration of
a company on which a notice is served under subsection (2) where the company
does not, within the time specified in that subsection, satisfy the Board that
it is carrying on insurance business in Trinidad and Tobago.
(4) The Board shall not cancel the
registration of a company in respect of any particular class of insurance
business so long as the company is under liability to Trinidad and Tobago
policyholders whose policies belong to that class unless the Board is satisfied
that—
(a) reasonable
provision has been or is being made to meet that liability; and
(b) adequate
arrangements have been or are being made for payment in Trinidad and Tobago of
premiums and claims on those policies.
(5) The Board may cancel the registration of
a company where—
(a) the Bank
is satisfied that the company obtained registration as a result of any
misleading or false representation;
(b) the Bank
is satisfied that there is unreasonable delay in the settlement of claims
payable under policies issued by it;
(c) one month
has elapsed since the date before which the company was required under this Act
to furnish information to the Bank and the company has, without reasonable
excuse, failed to furnish the information or failed to do so in the manner
specified in this Act;
(d) the
company is insolvent within the meaning of section 77;
(e) any of
the reinsurance arrangements of the company is not satisfactory; or
(f) a final
judgment obtained against the company in any Court and from which no appeal is
pending remains unsatisfied for at least two months.
(6) The Board shall, when the registration of
a company is cancelled—
(a) give
notice of cancellation to the company; and
(b) require
the company to deliver its certificate of registration to the Board within
twenty‑eight days of the cancellation or such shorter period as may be
specified in the notice.
26. Where in
accordance with this Act—
(a) the
Central Bank refuses to register a company; or
(b) the
Board cancels the registration of a company,
the Bank or the Board as
the case may require shall, within fourteen days of the refusal or
cancellation, notify the compnay in writing of its reasons for so doing.
27. (1) Where the registration of a company is
cancelled in respect of any class of insurance business, the company shall not,
after the date on which it was notified of the cancellation, enter into any new
contract of insurance falling within that class.
(2) For the purposes of subsection (1) a
company shall be treated as having entered into a new contract of insurance
where a contract of insurance entered into prior to the date of the
notification under section 26 is renewed or varied after that date.
(3) Nothing in this section shall be
construed as relieving an insurance company the registration of which has been
cancelled from the obligation to maintain the deposit required to be made under
section 29 and the statutory fund required to be maintained under section 37.
(4) A company which contravenes the
provisions of subsection (1) is guilty of an offence.
28. (1) A company which is aggrieved by the
decision—
(a) of the
Bank to refuse to register it; or
