Insurance Business (Jersey) Law 1996: The Jersey Mutual Insurance Society: Law drafting instructions to remove Jersey Mutual's exemption

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A decision made 7 February 2014:

Decision Reference: MD-C-2014-0022

Decision Summary Title :

Law drafting instructions to remove Jersey Mutual’s regulatory exemption

Date of Decision Summary:

4th January 2014

Decision Summary Author:

Director,

Finance Industry Development

Decision Summary:

Public or Exempt?

(State clauses from Code of Practice booklet)

Public

Type of Report:

Oral or Written?

Written

Person Giving

Oral Report:

N/A

Written Report

Title :

Law drafting instructions for an Amendment re Jersey Mutual

Date of Written Report:

4 February 2014

Written Report Author:

Director,

Finance Industry Development

Written Report :

Public or Exempt?

(State clauses from Code of Practice booklet)

Public

Subject:

Jersey Financial Services Commission (“JFSC”): law drafting instructions to remove Jersey Mutual’s exemption from the Insurance Business (Jersey) Law 1996 (“IBJL”).

Decision(s):

The Chief Minister confirmed that he was content for the law drafting instructions regarding the removal of Jersey Mutual’s exemption from the Insurance Business (Jersey) Law 1996 to be passed by the JFSC to the Law Draftsman for action.

Reason(s) for Decision:

The attached law drafting instructions were sent to the Law Draftsman on 22 November 2013. The Law Draftsman has recently advised us that a Ministerial Decision now needs to be made for all law drafting that is required.

Summary

When the Insurance Business (Jersey) Law 1996 (“IBJL”) was enacted, Jersey Mutual was granted an exemption from having to register under the law (by virtue of Article 5(5)(d)).

This exemption was commented on negatively by the International Monetary Fund (“IMF”) in its 2008 assessment of the Island’s financial regulatory standards. The IMF recommended that, “the scope of exemptions from the IBJL should be narrowed so that all insurers are required to be licensed and supervised by the JFSC.”

In response to that recommendation, the Commission has agreed with Jersey Mutual that the exemption in Article 5(5)(d) that it has historically relied upon should be removed. Indeed, Jersey Mutual is indeed now under voluntary supervision by the Commission.

The attached law drafting instructions request the Law Draftsman to remove the exemption.

Resource Implications:

As this is a minor amendment there are no significant resource implications.

Action required:

Provide confirmation to the JFSC that the Chief Minister is content for the law drafting instructions to be passed by the JFSC to the Law Draftsman for action.

Signature:

Position:

Chief Minister of Jersey

Date Signed:

Date of Decision (If different from Date Signed):