BCP Regulatory Framework 2 — Questions and Answers
Question 1: What is the role of appointed actuaries in Singapore insurance companies?
- To manage marketing campaigns
- To ensure the insurer's liabilities are properly valued and the company remains financially sound (Correct answer)
- To process claims only
- To recruit new insurance agents
Correct answer: To ensure the insurer's liabilities are properly valued and the company remains financially sound
Appointed actuaries are responsible for valuing insurance liabilities, advising on pricing, and ensuring the insurer maintains adequate reserves and meets solvency requirements under MAS regulations.
Question 2: What is the 'fit and proper' criteria imposed by MAS on insurance company directors and key officers?
- They must be physically fit
- They must demonstrate competence, honesty, integrity, and financial soundness to hold their positions (Correct answer)
- They must have at least 20 years of experience
- They must be Singapore citizens only
Correct answer: They must demonstrate competence, honesty, integrity, and financial soundness to hold their positions
MAS requires directors and key officers of insurance companies to meet 'fit and proper' criteria covering competence, character, financial soundness, and integrity to safeguard policyholders' interests.
Question 3: Under Singapore regulations, when must an insurer notify MAS about a significant event?
- Only at the end of the financial year
- As soon as practicable after the event occurs (Correct answer)
- Only when a policyholder complains
- Only during scheduled audit reviews
Correct answer: As soon as practicable after the event occurs
Insurers must notify MAS promptly of significant events such as material losses, changes in key management, regulatory actions in other jurisdictions, or anything that may affect the insurer's financial condition.
Question 4: What is the purpose of the Singapore Actuarial Society (SAS)?
- To regulate insurance premiums
- To promote the actuarial profession and set professional standards for actuaries in Singapore (Correct answer)
- To sell insurance products
- To manage CPF funds
Correct answer: To promote the actuarial profession and set professional standards for actuaries in Singapore
The SAS promotes the development of the actuarial profession in Singapore, sets professional and ethical standards, and provides continuing education for its members.
Question 5: What anti-money laundering obligations do Singapore insurers have?
- No obligations as insurance is exempt
- They must conduct customer due diligence (CDD), monitor transactions, and file suspicious transaction reports (STRs) (Correct answer)
- They only need to verify customer age
- They must report all transactions above SGD 100
Correct answer: They must conduct customer due diligence (CDD), monitor transactions, and file suspicious transaction reports (STRs)
Under MAS Notice 314 and the Corruption, Drug Trafficking and Other Serious Crimes (Confiscation of Benefits) Act, insurers must conduct CDD, ongoing monitoring, and report suspicious transactions to STRO.
Question 6: What is the Insurance (Amendment) Act 2020 key change regarding the regulation of insurance intermediaries in Singapore?
- It removed all licensing requirements
- It introduced a direct licensing framework for insurance brokers and introduced new conduct requirements (Correct answer)
- It made all insurance products free
- It abolished MAS oversight of insurance
Correct answer: It introduced a direct licensing framework for insurance brokers and introduced new conduct requirements
The Insurance (Amendment) Act 2020 introduced enhanced regulatory frameworks including direct licensing for insurance brokers, strengthened conduct requirements, and updated policyholder protection measures.
BCP Regulatory Framework 2
What is the role of appointed actuaries in Singapore insurance companies?