The Membership of the Syndicate is open to insurance and reinsurance companies registered in an African or Asian country, provided the applicant company fulfills the following minimum conditions:
- Be an ordinary, associate or correspondent Member of FAIR
- Subscribe in the Syndicate with a capacity of at least one Unit, (1 Unit = US$ 100,000) any one risk.
- A direct Insurance company Member should offer the Syndicate Facultative shares of its Oil and Energy related business.
- A reinsurance company Member should provide retrocession support to the extent required by the Syndicate and should offer the Syndicate Facultative shares of its Oil & Energy related business.
- Signing the Membership Application and Letter of Commitment.
- Agreeing to be bound by the “Syndicate Agreement” and “Articles of Association”.
- The approval of the Technical Board.
The Liability of the Members is a “Joint Liability” which means that if any Member defaults, Members not in default will be liable jointly for the share of the defaulting Member. Therefore the financial strength of the Syndicate Members is of paramount importance, and it is vital for the Syndicate to have well capitalized Members with good security standing.
Thus, Membership criteria were set to protect the interest of the Members and the cedants as follows:
- Any company applying for the Membership of the Syndicate should have minimum shareholders equity (paid up capital and free reserves) of US$ 10,000,000 or its equivalent.
- The maximum number of the Units of capacity that an applicant can subscribe with, should not exceed 2% of its free shareholders equity. In any case, the maximum number of Units subscribed by any Member should not be more than 10 Units.
Membership in the Syndicate takes effect on the January 1st of each year thus applicants should submit their Membership Applications at least one month before the end of the preceding year giving enough time for the application to be processed.
MEMBERSHIP APPLICATION PROCEDURE
- Fill, sign and stamp a “Membership Application & Letter of Commitment” form.
- Fill and sign a “Information Sheet” .
- Send the forms by Fax or email to the Syndicate.
- Send the original forms together with copies of the applicant’s Financial Statements for the last 3 years by courier service or registered mail to the Syndicate address.
- Applicants should provide some detailed information about the size of their Oil & Energy insurance portfolio and advise the estimated share to be ceded to the Syndicate.
Upon receiving the application the Managers will verify its fulfillment of the Membership guidelines and submit it to the Technical Board for approval. Once approved; the applicants will be advised to transfer the total amount of the subscribed Unit/s to be deposited with the Syndicate.