Risk Locator Tool
Provides guidance on what to consider when identifying the locations of risk for regulatory and tax purposes
Establishing Risk Location: Get more
What is a risk location?
Risk location(s) determine the territory or territories whose laws, regulations and tax rules apply to an insurance contract. The Risk Locator Tool (RLT) was built for Lloyd's market participants and houses thousands of risk location rules and triggers with the aim to assist in determining risk location(s). The general principles set out in the RLT and guidance provided on this page should be used in conjunction with country specific information on Crystal.
Failure to identify the correct territories for regulatory and tax purposes may lead to:
- delays in premium processing
- invalid insurance contracts
- inaccurate regulatory reporting and funding
- incorrect tax returns and tax payments
- insured’s, intermediaries or underwriters subjected to fines
- damage to Lloyd’s international reputation
All parties in the placement chain should comply with regulatory and tax obligations
No. It is possible for the territories of regulation and tax for a single contract to be different because they derive from different rules.
For instance, in the EEA the regulatory risk location for moveable property is the territory where the insured is resident but the tax risk location is where the moveable property is normally situated.
If a Canadian resident insures property outside Canada, this creates a risk location in Canada for regulatory purposes but not for tax.
Yes. There are several reasons why more than one territory’s laws, regulations and tax rules may apply to a contract, including:
- contradictory and overlapping regulatory and tax rules
- multiple risks insured
- multiple insureds
- involvement of intermediaries
If the regulatory rules of more than one territory apply with contradictory effect, a common sense approach is necessary and the underwriter should ensure arrangements provide appropriate protection to the insured.
If the contract is subject to more than one’s tax regime then taxes should be paid in accordance with each territory’s rules.
The Risk Location Guidance should be used in conjunction with the territory specific risk location information on Crystal.
Step 1 - select the relevant territory
Step 2 - select ‘Pre-placement considerations’ category
Step 3 - select ‘Definition of risk location’ sub category
Step 4 - click on ‘Create a tailored search’ to view the information