Managing agents wanting to set up a service company in Italy must be aware of the following considerations and requirements that make up the local environment.
Key considerations
Financial considerations
- No requirement to maintain trust funds in Italy.
- Premium and claims amounts must be deposited into separate bank accounts. Service companies may provide a bank guarantee to ensure the proper handling of these funds.
- All service company policies are subject to Italian taxes and charges.
- Service companies’ commissions, as insurance intermediaries, are exempt from VAT.
- Service companies should pay their own local taxes.
- Service companies must pay an annual charge of €1,300, invoiced in June.
- Service companies using Lloyd’s Italy services to participate in tenders must pay a €1,000 fee per policy, only if Lloyd’s Italy is awarded the contract, and the gross premium for the policy is €25,000 or more.
Operational considerations
- A physical office is required in Italy, depending on the type of operation. More information can be found on the IVASS website, or by contacting a Lloyd’s Italy representative.
- Must sign the “Lloyd’s Coverholder co-operation agreement” which incorporates an undertaking to the General Representative to comply with instructions relating to the processing of business.
- Must transfer the taxes due on the previous month’s premiums to Lloyd’s Italy via bank transfer.
- Must prepare a monthly tax statement using the Excel template provided by Lloyd’s Italy Office.
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Service companies operating under FOE (Freedom of Establishment) must produce insurance documents through approved systems such as DOPRINT and MOCHA.
Employee considerations
- Service companies in Section A or Section B of the Single Register of Insurance Intermediaries (RUI) must appoint at least one person responsible for distribution, who must also be registered in the same section. For service companies under Section B, the legal representative, and if appointed, the CEO and general director, must also be registered in Section B.
- The anti-money laundering function requirements depend on the number of employees and premiums collected. More information can be found in IVASS Order no. 111/2021.
- Visa information is found on the Italian Ministry of Foreign Affairs and International Cooperation, and on the Embassies websites.
Regulatory considerations
- Service companies must provide an annual list to Lloyd’s Italy of claims paid in the previous year.
As intermediaries, service companies are required to report on the following;
- Communication of Internet Domains
- Annual and Extraordinary Declarations
- Professional Liability Insurance
- Consumer protection and complaints handling
- Payment of supervisory fee
- Contribution to the guarantee fund
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Launch Crystal+Local Requirements
- Must be legally incorporated; either as a private limited liability company (Società a responsabilità limitata) or a public limited liability company (Società per azioni).
- Service companies must be set up in one of the 6 sections of the Single Register of Insurance Intermediaries (RUI) held by the Institute for the Supervision of Insurance (IVASS).
- Must obtain the appropriate IVASS licence and be registered with the IVASS registry of intermediaries.
- Crystal+ provides more information about the legal requirements for each type of intermediary.
- Must comply with Italian primary law (including EU regulations acknowledged by Italy), secondary law issued by IVASS, and Lloyd’s internal compliance.
Lloyd’s internal compliance- If the service company is an EU intermediary registered in the list annexed to the RUI, they are required to comply with IVASS' general good provisions.
Lloyd’s registration process
Initiation
Co-ordinate with Lloyd’s teams to understand country interest, define service company and set timelines.
Register and setup
Managing agents will submit business plans and work with country managers for regional setup according to local regulations. In tandem the service company is registered on Atlas to complete necessary business and company details.
Due diligence
Managing agent’s maturity rating under PBO Principles is used to determine whether an Attestation or Decision Paper is completed, demonstrating satisfactory due diligence has been conducted.
Service Company Underwriting Agreement
Once all registration and set up requirements are met, formal service company underwriting agreement can be signed and service company can start trading on agreed date.