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Gibraltar Finance Report
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in the footsteps of Zego, the first UK insurtech to start its own insurer, Extracover Insurance Company Limited, another Gibraltar insurance company that commenced trading in 2019.
For Gibraltar to have attracted the first two UK insurtechs to operate their own insurance companies reflects the success and development in recent years of Gibraltar’s £5 billion insurance industry with a host of technology led insurers.
In November 2020, we announced
some changes to our insurance intermediaries legislation with the aim of bringing more Managing General Agents (MGAs) to Gibraltar. A key change is the ability for MGAs to appoint insurance managers in a similar way to the 1989 legislation that has permitted insurance companies to do so for many years https://bit.ly/340jsV5 . This new legislation formalises and regulates the outsourcing arrangements between insurance intermediaries and insurance managers.
Insurance managers provide an essential role for many new applicants and
are a key reason for Gibraltar’s continued appeal to new insurance business. Large international insurance groups own all five of Gibraltar’s insurance managers.
Many insurtechs use the MGA model to begin testing their technology in a live underwriting environment. We expect the recent changes to widen our appeal to the insurtech sector because the compelling factors that have been so important to insurance companies are equally relevant to insurtechs.
We hope to attract more MGAs like Hedgehog Insurance, a Gibraltar MGA that launched in 2018 using intelligent, automated underwriting and data analysis to drive advanced risk pricing and fraud prevention powered by its own cloud-based software platform.
A fundamental component of Gibraltar’s appeal is access to the regulator. Meetings can be arranged in a matter of days enabling a business to be nimble and opportunistic, of great importance to fast moving insurtechs. As a smaller jurisdiction, Gibraltar can facilitate close working relationships with the
GFSC because all businesses are located within a short walk of the regulator.
Whilst access is hugely attractive, the robust regulatory oversight is clearly illustrated in a recent comment from Sten Saar the CEO and Co-Founder of Zego about the authorisation process “the Gibraltar regulator was incredibly thorough, asked a lot of tough questions to check that everything was in place and above board”.
The Government of Gibraltar is committed to creating a similar business environment for insurtech to the ones that have supported the insurance, fintech and online gambling sectors to become leading centres of excellence. We are confident that Gibraltar offers a platform for insurtech to develop, diversify and grow over the next 10 years.
Innovative jurisdiction
This strategy would appear to be striking a chord as illustrated by Oliver Kent-Braham the CEO and Co-Founder of Marshmallow who commented, “We are delighted to be welcomed to Gibraltar to operate our new insurance company. We had a clear requirement to find a location that would support our strategy of future expansion within the insurance market and as an established fintech hub; Gibraltar was of significant interest. Our experience with Gibraltar to date has been positive and efficient, we look forward to further benefiting from being in an innovative jurisdiction that encourages and enables us to develop close working relationships in the region.”
Gibraltar’s current pipeline of insurance applications is greater than it has been for many years and the quality of the applicants and their backers is very encouraging. We believe there are numerous reasons for insurtechs to benefit from becoming part of our wider insurance community.
‘Over the last five years, Gibraltar has developed into a leading FinTech hub and we hope 2021 will cement our credentials as a centre for leading insurtechs
www.gibraltarfinance.gi
10 Gibraltar International
www.gibraltarinternational.com
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