Insurance (Amendment) Regulations, 2026 (No. 29)

This is the largest change to insurance regulation in decades. It replaces the flat capital rules in the 1989 Insurance Regulations with a full risk-based solvency framework, and rewrites the governance rules that sit alongside it.

The Absolute Minimum Capital Requirement — the floor for registration and for continuing to operate — is US$2 million for life assurance including funeral assurance, US$500,000 for an insurer writing life solely for funeral policies, US$1.5 million for non-life, US$2 million for reinsurance, and US$100,000 for microinsurance, or the local currency equivalent at the RBZ rate.

Above that floor sit two calculated requirements. The Minimum Capital Requirement is the greater of the absolute floor and a combined figure derived from a linear formula on technical provisions and premiums, bounded between 25% and 45% of the Solvency Capital Requirement. The SCR itself is the amount needed to survive extreme conditions over twelve months at a 99.5% confidence level, calculated with the standardised formula in the Ninth Schedule — internal models are prohibited. The Commission may impose a capital add-on of anywhere from 0% to 100% of the SCR where an insurer's risk profile changes materially, where a breach could understate the SCR, or where market-wide events threaten stability, and it stays until the cause is fixed.

Assets and liabilities must be valued at fair value, with independent valuations where market prices are not available and quoted prices for listed group undertakings. A long list of assets is inadmissible for solvency: operating property, vehicles, furniture and IT hardware (funeral assurers may count coffins, hearses and service vehicles), intangibles and software, encumbered or disputed assets, assets without legal title, prepaid expenses, deferred acquisition costs, deferred tax assets, contingent assets, and receivables more than 90 days past due. Technical provisions are the best estimate liability plus a risk margin, calculated gross of reinsurance and segmented into homogeneous risk groups, with reinsurance recoverables valued separately.

Capital is tiered. Tier 1 must be at least 80% of the MCR and at least 50% of the SCR; Tier 2 is capped at 35% of the SCR and at most 20% of the MCR; Tier 3 must not exceed 15% of the SCR.

Governance changes are just as concrete. Boards must have between five and nine members, approved in writing by the Commission, with a balance of insurance, finance, legal, accounting and ICT skills and a majority of non-executive and independent directors. The chair and vice chair cannot be executives. Directors serve at most five years per term, one renewal, ten years in total, and may not sit on more than three other such boards. No one may acquire a significant interest — broadly 10% of shares or votes, or the power to appoint or remove directors — without the Commission's written approval, and cross-holdings between insurers, brokers and reinsurers need approval and cap related business at 20% of gross premium. Nominee companies and trusts must disclose beneficial owners.

Every insurer must maintain risk management, compliance, internal audit and actuarial control functions (the actuarial one is waivable by the Commission), each independent and documented, with the internal audit function externally reviewed every three years. An external audit firm may serve for a maximum of five years, then must sit out three. Every insurer must carry out an Own Risk and Solvency Assessment annually, document it continuously, report it to the board and submit it to the Commission, and must produce an actuarial function report, a solvency and financial condition report, a regular supervisory report, quantitative reporting templates, audited financial statements and disclosures to policyholders.

Supervision follows a five-stage ladder of intervention, from normal operations through early warning, risk to viability, serious doubt, and imminent insolvency. Contravening the solvency, governance, ORSA or disclosure sections is an offence carrying a fine up to level five or up to six months' imprisonment, or both, on top of whatever the ladder of intervention produces.

The regulations run to twelve schedules of formulae, correlation parameters and reporting templates; this summary covers the operative requirements, not the calculation detail, which an actuary will need to read in full.