SAMA gives insight into new Insurance Authority

Logo of Saudi Central Bank (SAMA)

The Saudi Cabinet, chaired by Crown Prince Mohammed bin Salman, approved the establishment of the Insurance Authority.

The Governor of the Saudi Central Bank (SAMA), Ayman Al-Sayari, said setting up the insurance authority will boost the efficiency of the insurance sector and increase its contribution to the Kingdom's non-oil GDP.

The new independent entity will also help develop the insurance industry and create well-established insurance institutions capable of growth and competition to enhance the whole industry as well as the Kingdom’s economy.

In addition, the insurance authority will work to develop the insurance sector by providing the appropriate environment and ensuring that the interests of beneficiaries and policyholders are not affected, the governor added.

The new entity, which will commence operations 90 days after the Cabinet resolution, will take over insurance-related responsibilities previously held by SAMA and the Saudi Council of Health Insurance (CHI).

However, SAMA and CHI will be in charge of the insurance-related responsibilities during a transition period until the new entity assumes full authority to ensure the sustainability of business activities.

Upon taking over its responsibilities, the new entity will consolidate all the insurance regulatory measures into a single regulator and transfer all channels of communication related to regulation and compliance in the insurance sector to the new Insurance Authority.

Furthermore, the authority will apply regulations and guidelines issued by SAMA and CHI to the insurance sector until they are amended.

The Central Bank confirmed that policyholders and beneficiaries are still subject to the relevant regulations.

This will also not impact the contractual relationship between the policyholder and the insurance company, and existing policies, claims, or complaints that are fully effective will remain intact.

The Insurance Disputes and Infractions Adjudication Committees will continue with no change.