Section 85A: Custody of assets of structured investment-linked
This section is inserted by Finance Act 2022, section 34.
consolidated text (as at 2016, amended since). juris shows the text as it was consolidated; it does not confirm that this is the law in force today.
85A. Custody of assets of structured investment-linked
insurance business
(1) No person, other than a custodian, shall hold the
assets of a structured investment-linked insurance business
policy for safekeeping.
(2) For the purpose of subsection (1), a long-term
insurer carrying out structured investment-linked insurance
business shall enter into a custodian agreement with a
custodian.
(3) A custodian under this section shall not, in
relation to a structured investment-linked insurance policy,
carry out an activity or a function in respect of which he has
not been licensed or authorised.
(4) (a) Any person, other than a custodian, who
holds the assets of a structured investment-linked insurance
business policy for safekeeping shall commit an offence.
(b) An insurer who allows a person other
than a custodian licensed to hold the assets of a structured
investment-linked insurance business policy for safekeeping
shall commit an offence.
(c) Any person who commits an offence
under paragraph (a) or (b) shall, on conviction, be liable to
a fine not exceeding one million rupees and to imprisonment
for a term not exceeding 5 years.
336 Acts 2022
(5) The Commission may, in the FSC Rules, specify –
(a) the process for the appointment of a
custodian under this section;
(b) the criteria for selecting a custodian under
this section;
(c) the terms of an agreement under
subsection (2);
(d) the powers, duties and obligations of
a custodian;
(e) the use of sub-custodians; and
(f) any other conditions relating to the use of
a custodian.
(h) in section 91, by deleting the words “2 years” wherever they
appear and replacing them by the words “5 years”;
(i) in the First Schedule, in Part I, by adding the following
new item –
Structured The business of effecting and carrying
investment-linked out contracts of insurance under which
insurance business the benefits are, wholly or partly, to be
determined by reference to the value
of, or the income from, a dedicated
investment portfolio held separately
for each policyholder with a custodian,
and which may include the own assets
and investments of the policyholder,
both existing at inception and accruing
over the future term of the policy, with
a minimum subscription at inception in
cash or assets which may be specified in
FSC Rules or guidelines.
Acts 2022 337