SAMA issues rules for foreign insurers in Saudi Arabia

Saudi Arabian Monetary Authority (SAMA), the Kingdom’s central bank, has issued monitoring as well as licensing regulations for branches of foreign insurance and re-insurance companies operating in Saudi Arabia.

Under these regulations, foreign insurance and reinsurance companies shall regularly submit reports on their financial solvency, in line with the regulatory requirements in the Kingdom.

Foreign insurers shall also submit reports on any decisions that may impact the business flow in the branches, including, but not limited to, decisions related to the capital, solvency, and the board of directors. SAMA has the right to set out further requirements at its sole discretion.

The value of the branch’s gross written premiums (GWPs) shall not exceed ten times the company’s equity and its reserves, except upon obtaining SAMA’s prior written approval.

The company shall evaluate and ensure the adequacy of the branch’s technical provisions on a quarterly basis. The company shall remain ultimately liable for settling all policyholder obligations and other liabilities of the branch.