SAMA published rules for licensing and supervision of branches of foreign insurance and/or reinsurance companies in Saudi Arabia. The rules describe the licensing requirements of SAMA, the prescribed application procedures, the processing fees, and the regulations expected to be followed by the applicants.
The rules state that SAMA requires the Branch to submit regular reporting forms in a similar format to those required for local insurance and/or reinsurance companies. SAMA requires the Company to submit regular returns to demonstrate its solvency determined according to Saudi Arabian regulatory requirements. In addition, SAMA requires the Company to inform it about any decisions that affect the Branch business, including, but not limited to, decisions related to the capital, solvency, and the board of directors. SAMA reserves the right to set out further requirements at its sole discretion. The Company shall evaluate and ensure the adequacy of the technical provisions of the Branch on a quarterly basis. The Company shall remain ultimately liable for settling all policyholder obligations and other liabilities of the Branch. If required, SAMA may also deploy the Branch’s Deposit stated in Article (14) of these Rules to settle the policyholder obligations.
Furthermore, SAMA rules specify that the statutory Deposit percentage for a Company shall be determined based on the credit ratings by allowed ratings classifications such as by S&P, AM Best, Moody's, or Fitch. If a ratings downgrade occurs, the Company shall inform SAMA and deposit the balance of the Deposit corresponding to the lower credit rating within ninety (90) days of such downgrade. If the rating of the Company is upgraded, the Company may apply to SAMA to reduce the Deposit to an amount corresponding to such upgraded rating with the change taking effect one year from the rating upgrade.
Related Link: Rules for Licensing and Supervision (PDF)
Keywords: Middle East and Africa, Saudi Arabia, Insurance, Foreign Insurers, Licensing Applications, Reporting, CRA, SAMA
FSB finalized the toolkit of effective practices to assist financial institutions in their cyber incident response and recovery activities.
HKMA urged authorized institutions to take early action to adhere to the IBOR Fallbacks Protocol, which ISDA is expected to publish soon.
FSB published a global transition roadmap for London Inter-bank Offered Rate (LIBOR).
HM Treasury published a document that summarizes the responses received from a consultation on the approach of UK to transposition of the revised Bank Resolution and Recovery Directive (BRRD2).
HM Treasury published the government response to the feedback received on the consultation for updating the prudential regime of UK before the end of the Brexit transition period.
In a recent statistical notice, BoE announced publication of the reporting schedule for statistical returns for 2021.
EC welcomed the joint declaration by 25 EU member states on building the next generation of cloud in Europe.
PRA published the final policy statement PS22/20, which contains the updated supervisory statement SS12/13 on counterparty credit risk.
FSB published an update on its work to address market fragmentation. FSB is working in this area in collaboration with the other standard-setting bodies.
EBA proposed revisions to the guidelines on major incident reporting under the second Payment Service Directive (PSD2).