Singapore doesn’t have a specific regulatory classification for MGAs. Entities wishing to perform MGA functions have to choose between registering as an insurance agent and/or a Lloyd’s coverholder (ie insurer side agent), or obtaining an insurance broker (ie insured side agent) authorization and registration.

An MGA taking the “broker” route will be regulated as an insurance broker by the Monetary Authority of Singapore (MAS). An MGA (logically) taking the “agent” route will be regulated by the Agents’ Registration Board (ARB) of the General Insurance Association of Singapore (GIA) as an insurance agent and/or Lloyd’s Asia as a coverholder. We understand however that in practice, there are MGAs in the market that seek registration and authorization as an insurance broker as the ARB imposes a “3-principal” rule that prohibits insurance agents from representing more than three insurers. For the purpose of the “3-principal” rule, Lloyd’s Asia is counted as “one principal.” Lloyd’s Asia coverholders can represent an unlimited number of Lloyd’s syndicates through the Lloyd’s Asia service companies.

Lloyd’s Asia coverholders are regulated by Lloyd’s Asia as syndicates of Lloyd’s and service companies duly registered with Lloyd’s Asia.

To be registered as an insurance agent with the ARB, an application has to be submitted by a licensed insurer that’s a GIA member. The registration can be completed within 3-5 days although it should be noted that the GIA insurer member would likely impose their own vetting and review procedures before making the application, which may take 3-6 months.

To be registered as a Lloyd’s Asia coverholder, an application has to be submitted by a Lloyd’s Asia service company. Similar to the case of an insurance agent, while the registration with Lloyd’s Asia may take less than a month, the service company can impose their own vetting and review procedures before making the application, which may take 3-6 months.

To be registered as an insurance broker, an application has to be submitted to the MAS and in practice, subject to the case load of the regulator, the process will likely take six months or more.

Singapore doesn’t participate in any EEA-style passporting regime. MGAs established in Singapore must obtain separate authorizations in each jurisdiction where they wish to operate. However, Singapore’s extensive network of bilateral agreements and its position as a leading financial center in Asia Pacific facilitate cross-border activities on a case-by-case basis.

There is no specific insurtech supervisory or authorization regime, but there is an increasing focus within MAS in this area.

There are no restrictions on foreign ownership of MGAs.

Both insurance brokers registered with MAS and GIA-registered agents are subject to the Singapore General Insurance Code of Practice issued by the GIA, which sets out the general market conduct that insurance intermediaries are subject to. The Code doesn’t explicitly use the term “Product Oversight and Governance” as seen in European frameworks, but it does set out principles that indirectly relate to product governance and oversight responsibilities, namely, the Code requires insurers and intermediaries to ensure that products offered are suitable for the customer’s needs, which is a core element of product governance.

Generally, an insurance broker has to set up an insurance brokerage premium account to separately deposit all client monies and has to submit returns to the MAS regularly.

The ability of a GIA-registered agent or a Lloyd’s Asia coverholder to collect client monies or hold premium would be subject to the terms of the binding authority between the insurer and the agent or coverholder. A GIA-registered agent is also subject to the ARB Premium Payment Rules. Under these rules, direct payment to and from the insurer to the insured is preferred unless the relevant payment or transaction falls under the exemption.

An MGA registered as an insurance broker can collect brokerage fees from the insured and the insurer. On the other hand, a GIA-registered agent isn’t permitted to impose charges on insureds and all fees are payable by the insurer(s).

An insurance broker registered with the MAS has to have a minimum paid up share capital of SGD300,000.

A GIA registered agent has to have a minimum capital requirement of SGD25,000.

Insurance brokers also have to maintain professional indemnity insurance under Section 77(1)(c) of the Insurance Act 1966 and the Insurance (Intermediaries) Regulations, whereas PII requirements may be imposed by the insurer principal(s) on the GIA registered agent under the agency agreement.

Singapore’s sophisticated regulatory environment and position as Asia Pacific’s leading financial center make it an attractive base for MGAs operating in the region.