Clause 10

Every Singapore insurer registered under this Act shall establish and maintain in accordance with this section an insurance fund in respect of the class or each of the classes of insurance business carried on by the insurer in Singapore so far as that business relates to Singapore policies.

There shall be paid into an insurance fund all receipts of the insurer properly attributable to the business to which the fund relates (including the income of the fund), and the assets comprised in the fund shall be applicable only to meet such part of the insurer’s liabilities and expenses as is properly so attributable.

In the case of a fund established in respect of life business, no part of the fund shall be allocated by way of bonus to participating policies, except with the approval of a qualified actuary and out of a surplus of assets over liabilities as shown on the last statutory valuation of the fund; and on the making of any such allocation that surplus shall be treated for purposes of this section as reduced by the amount allocated.

If on the last statutory valuation (in the case of a fund established in respect of life business) or in the last statutory balance-sheet (in the case of a fund established in respect of general business) there was shown a surplus of assets over liabilities of an insurance fund, there may, subject to any provision to the contrary in any instrument or contract binding the insurer, be withdrawn from the fund an amount not exceeding the surplus, and on the making of any such withdrawal that surplus shall be treated for the purposes of this section as reduced by the amount withdrawn:Provided that, in the case of a fund established in respect of life business, no withdrawal shall be made without the approval of a qualified actuary, and no part of the surplus attributable to participating policies shall be withdrawn in excess of one quarter of the amount allocated thereout by way of bonus to participating policies.

In respect of any policy belonging to the insurer’s life business which is under subsection (4) of section 9 of this Act removed from the insurer’s register of policies, there may be withdrawn from the fund established in respect of that business an amount not exceeding the prescribed amount.

Any amount withdrawn from an insurance fund under subsection (4) or (5) of this section and, in a winding up, any part of an insurance fund remaining after meeting the liabilities and expenses to which the fund is applicable may be dealt with as if it had not formed part of the fund.

In a winding up, assets comprised in the deposit made by an insurer under this Act in respect of either class of business shall be treated as assets of the insurance fund established by him in respect of business of that class, and subsections (2) and (6) of this section shall apply to those assets accordingly.

An insurance fund established by a Singapore insurer for any class of business shall, notwithstanding that the insurer at any time ceases to carry on that class of business in Singapore, continue to be maintained by the insurer so long as the insurer is required by this Act to maintain the register of policies for policies belonging to that class.

In the case of an existing insurer, any insurance fund shall be established as at the date of establishment of the insurer’s register of policies, and by reference to the policies registered or required to be registered in it as at its establishment, and by reference to the assets and liabilities of the insurer as at that date; and —

The amounts referred to in paragraph (a) of subsection (9) of this section are as follows: —