JAMAICA’S insurance sector is facing an additional $646.19 million in regulatory fees after the Financial Services Commission (FSC) issued revised invoices under its new fee structure.

In a July 1 notice posted on its website, the FSC said the revised fee calculation methodology is now in effect and that it will adjust invoices for 2026 annual fees.

“Further to the Financial Services Commission (FSC/Commission) Advisory to the insurance industry issued June 29, 2026, this notice confirms the revised fee calculation methodology is in effect and immediate steps will be taken by the Commission to make relevant adjustments to invoices relative to annual fees for the period 2026,” the FSC notice said.

The FSC approached Parliament earlier this year for amendments to the Insurance Act to increase fees charged to the sector as part of efforts to close its persistent deficit. The FSC said the revised fee schedule was gazetted on June 5 and is now in effect.

Although insurers had already paid their annual renewal fees for 2026, the FSC has now issued revised invoices to reflect the new fee schedule. The additional amounts represent the difference between what companies already paid under the old structure and what they now owe under the revised methodology.

General insurers face the larger increase. The 11 registered general insurance companies must pay an additional $500.05 million, on top of the $493.10 million already paid earlier this year. Under the new structure, general insurers will pay 0.45 per cent of audited total assets, replacing the previous formula of a $4.70-million fixed fee per insurer plus 0.20 per cent of total assets.

Life insurers must pay an additional $146.14 million, after already paying $210.02 million earlier this year. The six registered life insurance companies are now subject to a fee of 0.07 per cent of audited total assets, replacing the previous three-tier structure, which ranged from 0.04 per cent to 0.14 per cent of total assets.

The FSC noted in its advisory that it is finalising a fee calculator to be published on its website, but that registrants can email it for assistance with individual fee calculations.

“To support your ability to understand and comply with the revised fee structure, the commission will continue to respond to written queries relating to the application of the revised fee structure, fee calculations, and interpretation of the applicable methodology, and will provide further guidance through its established communication channels as needed,” the FSC noted.

It is not yet clear whether insurers will pass the higher regulatory cost on to policyholders through higher premiums. The question is especially sensitive for general insurance customers still seeking faster claims settlements after Hurricane Melissa.

The general insurance industry’s net profit fell from $2.6 billion in 2024 to $30 million in 2025, underscoring the impact of the Category 5 storm. The industry is also facing lower commissions from reinsurers and the possibility of higher reinsurance costs.

“The FSC will consider lessons learned from the impact of Hurricane Melissa in the enhancement of the regulatory, supervisory, consumer protection and public education measures. The commission remains committed to maintaining public confidence in Jamaica’s insurance sector through effective regulation, supervision and meaningful stakeholder engagement,” the FSC explained in its public statement on Hurricane Melissa claims.

FSC closing the gap

The fee adjustment comes as the FSC seeks to reduce its net deficit. The FSC reported a $502.36-million net deficit for its March 2025 fiscal year and expected to incur a $407.29-million net deficit for the March 2026 fiscal year.

According to the public bodies budget, the FSC expects to report a $186.24-million net deficit for the March 2027 fiscal year. This is based on a 44 per cent increase in its total revenue to $2.76 billion. The bulk of the increase is expected to come from higher fees, including securities fees, which are projected to double to $978 million, and insurance fees, which are projected to rise 57 per cent to $836.01 million.

The Securities Act was amended in July 2025 which pushed the annual renewal fees for securities dealers from $77.9 million under the old schedule to approximately $295.6 million under the new schedule.

The FSC expects to collect $21.25 million from Virtual Assets Service Providers (VASPs), which it intends to regulate this year. The FSC currently has an open consultation period for the VASP sector which ends on July 10. This forms part of the FSC’s move to regulate the space, which has come under increased scrutiny from the Financial Action Task Force.

The FSC’s fee hike to the insurance sector is now law.