Abacus Risk Management Services PCC has become Europe’s first insurance manager to be structured as a protected cell company (PCC) following the regulator’s approval of its first cell.

Originally established in 2009, Abacus Risk Management Services PCC is an associate company of Gasan Mamo Insurance. Its first cell, South Risk Management Cell, will focus on winning insurance business requiring management and risk management consultancy, backed by Abacus’s own knowledge base.

By establishing a protected cell company, or converting to a PCC, insurance firms are able to encompass one or more cells and to separate the assets of each cell.

Malta is the only European Union member state offering the PCC concept within its insurance legislation.

Abacus executive director Julian Mamo said the PCC concept had not been widely adopted in Europe bar Gibraltar, although Luxembourg is in the process of implementing PCC legislation.

Asked how Abacus Risk Management Services PCC came to be a European first, Mr Mamo told The Sunday Times that insurance management in Malta was a growth area which has been brought about by many years of preparatory work. The legislative and supervisory frameworks, and Malta’s adoption of the euro, had been key to growth.

“When we recognised we could participate in this particular area, we considered which structure to adopt,” Mr Mamo said.

“To bring a fresh component to the table we decided to be structured as a PCC and so have a two-pronged marketing model: direct with clients or through cells.

“Cell owners would benefit from an insurance manager’s licence without the burden of having to put up the minimum capital as required by law, and without having to go through the full management licensing process.

“The cell would effectively be a part of Abacus Risk Management Services PCC Ltd. We identified early on that there would be people out there who would benefit from this structure and we have, in fact, been proven right.”

Abacus boasts an illustrious team with broad international technical experience. The executive directors include Gasan Mamo Insurance managing director Albert Mamo, former Aviva European director Baudouin Deschamps, and former Zurich (Benelux) managing director Ron Clark.

Abacus has formed strategic relationships with firms associated with insurance management and has several years’ experience in captive insurance, global insurance programmes, and risk management.

Abacus also benefits from the extended team at Gasan Mamo which currently has a staff of130.

Mr Mamo explained that the service Abacus rendered to an insurance company would be no different as a result of the manager being structured as a PCC. The difference mainly lay in the reach the PCC had to potential clients.

Firms looking to participate in the insurance management process without the need to become an insurance manager in Malta would benefit by servicing clients through a cell in Abacus.

As an example, Mr Mamo offered that of an insurance manager from outside the European Union with clients requiring an EU domicile. A cell would allow the company to service the client cost-effectively and in a practical way.

PCC legislation provided comfort that cells were free from the risk of ‘contamination’ from one another.

Abacus Risk Management Services PCC has been present in foreign markets through direct marketing and participation in road shows and conferences.

Last November, it organised an event in Brussels with participants from across the Benelux region.

Mr Mamo was confident the formation of the South Risk Management Cell would bring business to Abacus and to Malta.

Meanwhile, Abacus will continue to work to assist clients with their risk advisory requirements and those considering alternative risk transfer, including the formation of captive insurance businesses to cover their own risk.

“This new cell is another step in the implementation of the Abacus plan,” Mr Mamo added. “Through its contacts, it will generate business that will be carried out by Abacus since it is an integral part of our company.

“As for Gasan Mamo, we see this as a natural development – we are using our extensive knowledge base in new and growing areas.

“As one of Malta’s leading insurers, through this vehicle we will have access to markets outside Malta without running any downside for our local operation.”

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