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Lloyd’s is registered as a Foreign Reinsurer in Colombia. This registration enables Lloyd’s underwriters to write reinsurance business on a cross-border basis or local underwriting of reinsurance via Managing Agent delegates.1 Onshore coverholders are not permitted to operate within Colombia.
The Colombian regulator – the Superintendencia Financiera de Colombia (“SFC”) has issued new requirements for all registered foreign reinsurers to provide details of all coverholders binding Colombian reinsurance business across borders.
This Market Bulletin aims to clarify the notification requirements for coverholders underwriting Colombian reinsurance business from abroad. The requirements are outlined in Annex 1 of SFC Circular Externa No. 020, of 03 October 20182. Annex 1 of this Market Bulletin contains an extract of the relevant regulations (in original Spanish and free English translation).
Coverholder notification requirement
Lloyd’s coverholders based outside Colombia are permitted to write Colombian reinsurance business across borders under Lloyd’s underwriters’ reinsurance license. New requirements issued by the regulator (SFC External Circular 020 of 03 October 2018) state that the registered reinsurer (Lloyd’s Underwriters) must notify the regulator of their intention to appoint offshore coverholders, submitting a notification which must include details of all the coverholders that will write reinsurance business across borders. Following the submission, the coverholder will be allowed to underwrite Colombian business on behalf of the concerned reinsurer.
To initiate the process, Lloyd’s coverholders based outside of Colombia that intend to transact Colombian reinsurance business across borders are required to contact Lloyd’s Representative Office in Colombia (email to: firstname.lastname@example.org) with the following information:
- Name of the coverholder;
- Supporting syndicates numbers and names;
- Lines of business and type of cover;
- Limits of subscription (territorial or total exposure limits);
- Period of validity of the binding authority;
- Copy of the binding authority; and
- Details of a point of contact who will be engaged throughout the notification process.
To ensure continuous compliance with the notification requirement, coverholders must notify Lloyd’s Colombia of any changes to the binding authority, including any modifications to the agreement, renewal or cancellation. This notification should be issued as quickly as possible and must not exceed 14 calendar days after the changes have come into effect.
See the full text of the Circular here: https://www.superfinanciera.gov.co/descargas/institucional/pubFile1033597/ce020_18.doc
See the Annex here: https://www.superfinanciera.gov.co/descargas/institucional/pubFile1033629/ance020_18.zip.
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