|Hiyasmin H Lapitan|
A non-Philippine resident foreign reinsurer has to meet the paid-up capital requirement applicable to its Philippine counterparts in order for it to have a resident agent licensed by the Insurance Commission of the Philippines (IC). This is based on the IC's Insurance Circular Letter No. 2015-16 which was issued recently. The circular provides additional requirements in relation to an application for registration with the IC of resident agents of non-resident foreign reinsurers.
A resident agent of a non-resident foreign reinsurer is a natural or juridical person who is a Philippine resident and who is authorised to receive notices, summonses, and other communications on behalf of the reinsurer in relation to claims or suits in the Philippines against the reinsurer. If a non-resident foreign reinsurer does not have an IC-licensed resident agent, a Philippine insurer will not be able to directly cede risks for reinsurance to it.
In cases where the non-resident foreign reinsurer does not meet the applicable capitalisation requirement, its resident agent may instead submit to the IC proof that the reinsurer's financial strength is as follows:
|AM Best||At least A rating|
|Fitch||At least AA rating|
|Moody’s||At least Aa rating|
|Standard and Poor’s||At least AA rating|
Insurance Circular Letter No. 2015-16 also applies to an applicant for registration with the IC of a resident agent of a non-resident foreign reinsurance broker. Thus the applicant has to submit to the IC proof that such broker's paid-up capital is at least equal to the capital required of a local reinsurance broker.
The licence of a resident agent of a non-resident foreign reinsurer or non-resident foreign reinsurance broker is valid until December 31 of the third year following its issuance, and may be renewed.
Hiyasmin H Lapitan
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