Malta is famous for its history-making role in the Second World War. The Mediterranean island withstood all attempts by the Germans to subdue it, and in 1942 was awarded the George Cross by George VI to “bear witness to the heroism and devotion of its people during the great siege it underwent in the early parts of World War II.” Today, the Island commemorates its glorious wartime role in August each year, but it’s not soldiers who flock to the Island, but tourists.
Although Malta is a tourist island par excellence, it is increasingly becoming known for its financial services expertise, especially since joining the EU in 2004. While there is plenty of wailing and gnashing of teeth in the UK after to the EU Referendum, the Maltese are quietly getting on and taking advantage of their status as an EU Member State to become an efficient and competitive domicile for the European onshore insurance industry.
One of the key factors for choosing Malta is that it remains the only full EU Member State which currently has the innovation of fully fledged protected cell company (PCC) and Incorporated Cell Company (ICC) legislation. This legislation allows insurers to create a structure which is less demanding on capital thereby reducing costs which are ultimately shared across the company and its cells.
Malta is now extremely well positioned to benefit from the increasing awareness of captive and protected cell solutions. Small to mid-cap companies are expected to become a high growth area for Malta as they seek to compete directly with their larger counterparts by taking accountability and control for their own risk management strategy.
The Malta Financial Services Authority (MFSA), which regulates the industry, has implemented a firm yet innovative approach: tough yet fair regulation, but committed to market growth, meaning that Malta can take advantage of enquiries from amongst other emerging insurance markets such as Eastern Europe and Asia.
The Maltese Government has created a business-friendly regime, and I believe the Island will continue to draw new investment and become an increasingly attractive domicile for insurers and would-be insurer companies.
One of those companies is Building Block Insurance PCC, which is able to provide services directly in the EEA (on freedom of services basis), without the additional expense and requirements of traditional fronting arrangements. We have been doing business in Malta since 2014, and have been impressed by its highly skilled workforce, as well as the Island’s track record in building a flourishing financial services sector which remains resilient to the wider economic conditions affecting other parts of Europe.
We are able to help brokers and other insurance distributors benefit from the significant advantage that Malta has to offer, over and above its colorful wartime history, bringing Malta’s successful track record and achievements to the UK insurance sector.
Friday, 08th July, 2016