The original 3AW warning light assimilator (WLA) is a crude normally closed relay. The coil receives the AC from the alternator and when the voltage is high enough it opens the contacts so the warning light goes off. The exact point of the opening is not exact so it doesn't mean your bike is more excellent than everyone elses' if your warning light is off during idling.
I found out the hard way that the spring is necessary to isolate the WLA can from vibration. If it touches anything it will die. There are some nice solid state replacements for them. I got mine from "Cool Cat Express" for $19.95. Jaguars use the same setup as the Norton. They call it the SS3AW. For positive ground like we have you must switch the black and orange leads. I think Old Britts also has one.
I like to try and keep my bike looking stock but others have installed small voltmeters to better monitor the charging system. Some have used the red indicator to detect oil pressure instead by connecting to an automotive oil pressure sender.