An international insurance licence is specifically designed to encourage captive insurance companies, i.e. companies wholly owned by a non-insurance company or companies, underwriting the insurable risks of their owners or associates.
By virtue of this status, the exempted insurer is not subject to the normal provisions applying to local insurers such as
- Minimum net assets;
- Restrictions on the type of investments permitted;
- Requirements to maintain accounts of non-insurance business and life insurance business separately;
Reasons for establishing a captive
- To minimise the cost of risk management by eliminating a portion of overheads/administrative costs and profits which are included in the premiums of conventional insurers;
- Ability to tailor policies and risk insurance to the needs of the insured party who would no longer need to rely on standardised policies;
- Tax minimisation and deferral e.g. tax free underwriting and investment earnings by the offshore captive outside the parent company's country of residence for tax purposes;
- Reduction of net insurance cost through reinsurance credits and commissions retained by the captive;
- By aggregating corporate or group premiums in one company, better placement of funds can result;
- By deciding when corporate/group premiums will be paid as against when reinsurance premiums fall due, overall cash flow may be improved.
Features of a Vanuatu International (Captive) Insurance Company
- The offshore insurance company must be incorporated as an exempted company in Vanuatu and as such it is not permitted to do business in Vanuatu other than to transact business with another exempted company and deal with its accountants, lawyers and bankers in Vanuatu;
- The company may hold bank accounts in a Vanuatu bank, in any currency and there are no exchange controls;
- There is a high degree of confidentiality in respect of an exempted company - whilst an annual return, detailing the company's directors and shareholders, and audited accounts must be filed at the Vanuatu Financial Services Commission and Reserve Bank of Vanuatu this information is not a matter of public record;
- An exempted company must have at least two directors, who may be either corporate or natural persons. There is a requirement for one director to be a Vanuatu resident. If necessary, We may be able to introduce other professionals to provide a nominee director;
- The administration of a captive insurance company may, and usually does, take place outside Vanuatu.
- Minimum capital requirement for a captive insurer engaged in several insurance businesses is Vt100,000, otherwise the minimum capital required for any other international insurer is Vt 30,000 M.
*Fees charged for assisting with the licence application are incurred on a time spent basis and are dependent on the quality of the information provided to us and the level of enquiries from the Vanuatu Financial Services Commission.
*USD5,000 must be forwarded to us at the commencement of the application process, which is then offset against any future invoices.
Once the application is ready to lodge we will require the balance of funds to cover the incorporation, annual licence and registered office fees etc.
For details of annual and other Exempted Insurance Company Fees click here
To obtain additional information, please contact us by e-mail at email@example.com