Labuan Life Insurance Business

Valsen Fiduciaries has been a leading partner for investors looking to register a life insurance business in Labuan. Part VII of the Labuan Financial Services and Securities Act 2010 defines an insurance business as the carrying out of contracts to protect people against loss or liability to loss regarding risks that the insured person may be exposed to, or the payment of a sum of money or other benefit of value in the event of a disaster.

A Labuan life insurance business is defined as: an insurance business connected with any policy by which payment of policy monies is insured on death or on the happening of any contingency dependent on the termination or continuation of human life and includes any incidental extension of cover and reinsurance of such business. Let Valsen Fiduciaries help you set up your Labuan Life Insurance Business today!

Licensing Requirements for Labuan Life Insurance Business

  1. Applicant must maintain a minimum paid-up capital or working funds with a bank in Labuan amounting to RM7.5 million or its equivalent in any foreign currency.
  2. Applicant must be a member of the Labuan International Insurance Association.
  3. Applicant must provide a letter of guarantee or undertaking from the parent company to Labuan FSA.

Operational Requirements for Labuan Life Insurance

  1. Applicant for a licence to carry on a life insurance business in Labuan must:
    1. Establish an operational management office in Labuan managed by a management team that has adequate knowledge and expertise in the insurance business; or
    2. Appoint a licensed Labuan underwriting manager.
  2. Appointment of any person in control, director or principal officer (PO) of a Labuan life insurer must obtain prior approval from Labuan FSA. Notwithstanding, Labuan life insurers that are established as a branch are not required to obtain approval on the appointment of their directors.
  3. The person in control, director and PO of a Labuan life insurer must be fit and proper persons and shall not be subject of any adverse report from any reliable sources.

Labuan Life Insurance Business Tax Treatment

  1. Tax and business incentives: Any trading company, which includes insurance business, will only have to pay tax at the preferential rate of 3%. Alternatively a flat rate of MYR 20,000 (USD 6,700) can be paid.
  2. No withholding tax: Withholding taxes are not imposed on the beneficial owner’s income.

Labuan Life Insurance Business Distinctive Benefits

  1. Tax and business incentives: Any trading company, which includes insurance business, will only have to pay tax at the preferential rate of 3%. Alternatively a flat rate of MYR 20,000 (USD 6,700) can be paid.
  2. No withholding tax: Withholding taxes are not imposed on the beneficial owner’s income.
  3. No exchange control imposed: Labuan companies are not subject to The Exchange Control Act 1953 because of their non-resident status (ECM 15).
  4. Extensive double taxation treaty (DTA) network: Labuan is included in Malaysia’s DTA. This means, Labuan can access the extensive double taxation agreements made by Malaysia with its treaty partners.
  5. Minimal renewal fee: The annual licence fees are very reasonable particularly for brokers and managers. The table below outlines the different fees:

Government Fees

Type of License

License fees

Life Insurer

RM 50,000

USD15,000

PCC Structure

 

 

Core

RM 30,000

USD 9,500

Each Cell

RM 10,000

USD 3,000

Our Services

Valsen offers a full spectrum of support services tailored to the unique requirements of each insurance business. From inception until the launch of full operations, Valsen has years of experience as a dedicated partner.

We offer the following range of solutions that are customised to meet your business’ needs:

  • Structuring and licensing of the insurance company
  • Sourcing banking partners and other integrated banking services
  • Sourcing local or international insurance agents/brokers
  • Drafting compliance procedures and regulatory manuals
  • Acquisition of virtual or physical office space
  • Provision of technical software and development of online platforms for the insurance business

With our rich pool of networks and expertise in the insurance industry, Valsen guarantees excellent support service for your business! Contact us for any professional advice.

 

Why Valsen

  1. We will advise you on the optimal legal structure for your requirements, size, expectations and circumstances. We have extensive knowledge of a wide range of legal structures in all major jurisdictions. (Securities, Banking, Insurance, Investment Management, Gaming and many more)
  2. Valsen will assist to complete every form for each process in the best way we know how (Based on our many years’ experience with various regulators and service providers across the world)
  3. Valsen will assist in preparation of winning business plans based on our superior understanding of regulator expectations and requirements
  4. We are very hands on in the post filing period checking with re regulator and service providers and updating you regularly. Any queries raised by the regulators and service providers during processing will be quickly synthesized by us and we shall craft the right responses to move the process forward fast.
  5. We can provide you with fit and proper directors in case you need. We have a wide network of qualified and experienced lawyers, chartered accountants, chartered financial analysts, wealth managers, FX experts, Investment advisors etc. of international pedigree.
  6. We have a full in-house compliance support for all compliance requirements with the regulator and service providers
  7. Through our extensive network, we provide sign up services with major service providers including but not limited to; Liquidity providers, technology providers, custodians, prime brokers, legal advisors, auditors, payment gateway providers among others.