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Benefits of a Gibraltar Insurer
Gibraltar's laws are ideal for the establishment of an insurance company. It is within the EU and has fully implemented EU directives on insurance making it possible for insurance companies which establish in Gibraltar to cover risks in any EU Member State.

Supervision and Regulation
Gibraltar's financial services are regulated by the Financial Services Commission established pursuant to the Financial Services Commission Ordinance. The Commissioner, supported by the Insurance Supervisor, supervises insurance business to UK standards.

The Commissioner welcomes the establishment of reputable insurance companies in Gibraltar.

A Gibraltar insurer may apply for tax exempt status which means it will pay ?225 per annum and no more on its profits. An insurer may alternatively, if for company or tax reasons it considers it preferable, apply for qualifying status which means it may negotiate a tax rate of between 0% and 35% on profits per annum.

Incorporation and Registration Costs
The costs of incorporating an insurance company depends on the authorised capital of the company. Duty of 0.5% of the authorised capital is payable on incorporation.

A licence application is made to the Financial Services Commission. An initial fee of ?500 is payable and thereafter an annual fee of ?2,000.

Licence Requirements
The Commissioner will only issue a licence if he is satisfied that the company will carry on the insurance business with integrity, prudence and with the professional skills necessary for the range and scale of the business undertaken. A licensee will need to satisfy the Commission that:
The company's shareholders, directors and managers are 'fit and proper' and will manage the affairs of the company in a sound and prudent manner.
It has a coherent business plan which will enable it to adhere to EU requirements including meeting the prescribed solvency levels.
It has proper reinsurance arrangements in place.

Financing and Minimum Guarantee Funds
No minimum share capital is specified in the legislation but the Commissioner will need to be satisfied that the company has adequate financial resources to support its business plan and to meet the required solvency margin which, for general business, is approximately 18% of the gross written premium. Outwards reinsurance arrangements can reduce the required margin of solvency by up to 50%. If the formula produces a smaller amount, then the minimum guarantee fund (the smallest amount to be maintained by the company over and above the capital and retained earnings to meet technical reserves) is 200,000 to 400,000 Euros depending on which type of business is to be written.

On-going Supervision
The Commissioner is responsible for the on-going supervision of insurance companies and requires a licensed insurance company to:
Maintain at all times a place of business in Gibraltar and keep its insurance and accounting records here.
Run its business in a sound and prudent manner.
Submit to the Commission financial statements within six months of the end of its financial year.
Maintain solvency margins and minimum guarantee funds at all times.
Obtain approval of any change of directors, managers and controllers of the company.

Advantages of a Gibraltar insurer
Gibraltar is within the European Union and the EU insurance directives have been fully implemented. This means a Gibraltar insurer may cover risks situated in any EU member state.
Minimal corporation taxes are payable in Gibraltar by companies with exempt status.
Favourable establishment and operating costs.
No insurance premium tax is payable on insurance of risks situated in Gibraltar.
Local insurance, legal, accountancy and banking expertise.
Fully regulated by the Financial Services Commission in accordance with EU directives and to UK standards.