Licensing for the Insurtech in Singapore

Licensing for the Insurtech in Singapore

As the name suggests, Insurtech is a combination of insurance services and technological tools. That is, it is using technology to improve the services that insurers offer. Singapore’s ecosystem motivates innovation; hence it is among the best places to start an Insuretch company. In the last couple of years, this sector has progressed as many investors venture into the business. Are you thinking of starting an Insuretch in Singapore? If that’s the case, worry no more since you are in the right place. This article will explain some of the most important requirements you must keep in mind, especially in the licensing sector, to not crash with the law.

Requirements to start an Insurtech in Singapore

An Insurtech business is considered under the Singapore Companies Act since it is a company. It is under the MAS (Monetary Authority of Singapore), which operate under the Insurance Act. The insurance laws govern the reinsurers, insurers, brokers and agents. You can choose to start an Insurtech as either a foreign insurer or registered insurer. The latter can deliver services directly, while foreign insurers will work under Lloyd’s scheme to provide services.

Like Fintech, Singapore’s government has yet to set up a regulatory framework that directly affects the Insuretch sector. However, every actuary is required to register their business under the Companies Act. One of the most common setting to register is under the Private Limited Company. Why is that? It features simple requirements that business people must meet hence making kicking off an Insuretch easy. Some of the requirements include

• Select an entity and register it under the Insurance Act
• Responsible chairperson
• Professional actuary for life insurers and certified actuary for non-life insurance services
• All the executives must pass the MAS’ proper test

Licensing of Insurtech companies

As mentioned earlier, Singapore’s government is yet to set up a regulatory framework that directly affects the Insurtech sector. This industry rose to fame in Singapore a few years back. Blending technology with insurance services for effective services was initially unheard of, but with Fintech coming in years ahead, Insurtech was welcomed in Singapore. Like Fintech, Insurtech is yet to have a stable regulatory framework that governs how these companies work. However, the Singapore Companies Act state that every company opened in Singapore falls under this category. As a result, opening an Insurtech must have the necessary licenses that companies have to become legit.

Also, insurance-related companies can either work as foreign insurers or licensed insurers under the Insurance act. Foreign insurers must meet the share capital conditions, stating that they must have at least S$5 million to offer life insurance options and at least S$10 million to provide other non-life insurance options. Licensed insurers must also have a share capital of at least S$25 million. Additional requirements to become a legit Insurtech company include having professionals working in the firm for high-quality results.

Conclusion

Insurtech companies’ sector provides digital tools to assist in the insurance sector, and Singapore welcomes both the locals and foreigners to venture into the business. The licensing process is straightforward, offering a friendly ecosystem to do business.