New legislation allowing the incorporation of Protected Cell Companies (PCCS) and Financial Guarantee Insurance (FGI) are the most recent examples of the willingness of the Financial Services Commission to support worthwhile innovation especially as only two other territories in the world have FGI legislation.
PCCs permit the business of different insureds to be placed in different cells within the same company. This means that the remaining cells need not be contaminated if creditor action exhausts the assets of one particular cell. The Commission anticipates the introduction of PCCs will encourage the development of rent-a-captive business in Guernsey and extend the benefits of captive insurance, previously the exclusive domain of medium to large corporations, to smaller companies and organisations.
FGI, or bond insurance, guarantees an insured's obligations to pay principal and interest when due, for example, from the issuers of municipal bonds and asset-backed securities.
In the past, the Commission has also supported other important innovations. They include the introduction of Guernsey International Companies which, among other things, offer a highly tax-flexible corporate entity useful to some clients of captive insurance company managers. It also encouraged 'capping' document duty at a maximum of £5,000 a year thereby introducing huge financial savings for insurance companies capitalised in the multi-millions.
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For further information contact Peter Crook on Tel: +44 (0) 1481 712706 or visit the Guernsey Financial Services Commission Web Site at:
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