Covered activity and key rule
- Investments made under an Investment Management Agreement (IMA) must receive prior approval from the Insurance Commission.
- The approval requirement applies to investments made under the IMA account.
Requirements for prior approval
- A request for approval must be accompanied by a Board Resolution authorizing the placements under the IMA.
- The request for approval must include a pro-forma copy of the IMA.
- The request for approval must include three (3)-year Audited Financial Statements of the investment or fund manager.
- The investment or fund manager must be duly licensed and authorized by the Bangko Sentral ng Pilipinas.
- All investments under the IMA must comply with the provisions and limitations under the New Insurance Code and applicable Insurance Commission circulars and regulations.
Mandatory clauses in the IMA
- Every IMA must incorporate the rule that all investments under the Agreement shall be registered in the name of the company.
- Every IMA must incorporate the rule that all investments shall be in accordance with the provisions of the New Insurance Code and applicable circulars and regulations issued by Insurance Commission.
- Every IMA must incorporate the rule that investment risk exposures are clearly defined and measured in accordance with the Risk-Based Capital (RBC) framework.
Ongoing reporting to the Insurance Commission
- The Insurance Commission must be furnished with quarterly reports on the investments held under the IMA account.
Cross-references and compliance framework
- The circular ties investment conduct and limits to the New Insurance Code.
- The circular requires observance of applicable circulars and regulations issued by the Insurance Commission.
- The circular requires risk measurement consistent with the RBC framework.