SAMA Issues Rules for Licensing and Supervision of Foreign Insurers
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
Featured Experts
María Cañamero
Skilled market researcher; growth strategist; successful go-to-market campaign developer
Pierre-Etienne Chabanel
Brings expertise in technology and software solutions around banking regulation, whether deployed on-premises or in the cloud.
Nicolas Degruson
Works with financial institutions, regulatory experts, business analysts, product managers, and software engineers to drive regulatory solutions across the globe.
Related Articles
APRA Finalizes Reporting Standard for Operational Risk Requirements
APRA finalized the reporting standard ARS 115.0 on capital adequacy with respect to the standardized measurement approach to operational risk for authorized deposit-taking institutions in Australia.
EBA Consults on Pillar 3 Disclosure Standards for ESG Risks Under CRR
EBA is consulting on the implementing technical standards for Pillar 3 disclosures on environmental, social, and governance (ESG) risks, as set out in requirements under Article 449a of the Capital Requirements Regulation (CRR).
ESAs Issue Advice on KPIs on Sustainability for Nonfinancial Reporting
ESAs Issue Advice on KPIs on Sustainability for Nonfinancial Reporting
EU Amends CRD4 and CRD5 as Part of Capital Markets Recovery Package
EU published Directive 2021/338, which amends the Markets in Financial Instruments Directive (MiFID) II and the Capital Requirements Directives (CRD 4 and 5) to facilitate recovery from the COVID-19 crisis.
EBA Publishes Single Rulebook Q&A Updates in February 2021
The EBA Single Rulebook question and answer (Q&A) tool updates for this month include answers to ten questions.
ESMA Releases Schema and Instructions for Securitization Reporting
ESMA updated the set of questions and answers (Q&A), along with the reporting instructions and an XML schema for the templates set out in the technical standards on disclosure requirements, under the Securitization Regulation.
EU Rule Amends Requirement for European Single Electronic Format
EU published Regulation 2021/337, which amends the Transparency Directive (2004/109/EC), regarding the use of the single electronic reporting format for annual financial reports.
EU Committee Recommends Systemic Risk Buffer of 4.5% in Norway
The Standing Committee of the European Free Trade Association (EFTA) recommended that a systemic risk buffer level of 4.5% for domestic exposures can be considered appropriate for addressing the identified systemic risks to the stability of the financial system in Norway.
PRA Clarifies Approach to Onshoring of Credit Risk Rules for UK Banks
In a recent statement, PRA clarified its approach to the application of certain EU regulatory technical standards and EBA guidelines on standardized and internal ratings-based approaches to credit risk, following the end of the Brexit transition.
FSB Sets Out Work Priorities for 2021
In a recently published letter addressed to the G20 finance ministers and central bank governors, the FSB Chair Randal K. Quarles has set out the key FSB priorities for 2021.
