Middle East | Publication | marzo 2024
The first Riyadh International Disputes Week took place earlier this month which highlighted the region's rapidly developing legal landscape in a bid to promote continued investor confidence and the execution of Vision 2030.
In this article, we discuss one of the most important developments relating to the insurance sector in the Kingdom: the regulation of disputes and the new regulatory authority established to govern insurers.
The Saudi Insurance Authority (the Authority) officially commenced its operations on 23 November 2023 as the sole regulator of the insurance sector in the KSA, following its establishment on 25 August 2023.
On 25 August 2023, the Saudi Cabinet approved and announced the establishment of the Authority as a new unified and independent regulator for the insurance sector in the KSA. The Cabinet also approved the founding law of the Authority which describes its mandate and its powers.
This marks a significant shift in the insurance landscape in the KSA as the Authority has now become the sole regulator of the insurance sector. Previously, the Saudi Central Bank (SAMA) and the Council of Health Insurance (CHI) traditionally served as regulators of the insurance market in the KSA and laid down the existing legal framework in place.
The move unifies the regulator of the insurance sector in the KSA (from two regulators to one) and demonstrates the country’s stride towards achieving the objectives of the Saudi Vision of 2030 and the Financial Sector Development Program (FSPD); a key pillar of which is driving growth and supporting the development of the insurance sector. The Authority has already reported a 14.6% growth in the sector in the third quarter of 2023, and we expect this to see this growth continue throughout 2024 as the Authority becomes fully operational and lays down a new legal framework for the sector.
The Authority will have the insurance mandate currently vested in SAMA and CHI. The founding law governing the Authority, published on 25 August 2023, contains 15 key articles including:
There will be a transitional period during which all competencies related to insurance will be transferred to the Authority. SAMA and CHI will continue as regulators of the insurance sector until all such competencies have been fully transferred to the Authority. SAMA’s existing legal framework will continue to stay in force until a new insurance law has been established. We await the promulgation of this new law.
The establishment of the Authority is a welcome move as it will bring about unification of regulatory procedures for the insurance sector, consolidate the principles and pillars of the contractual insurance relationships and grow and develop the sector.
Until such time as the Authority becomes fully operational and issues its own regulations, there will be no impact on existing insurance policies or claims. The current complaint handling process and the processes of the Committees for Resolution of Insurance Disputes and Violations (a specialist tribunal in the KSA for insurance disputes) also remains unchanged pending further clarification.
For further insights or assistance, please contact the authors Mohammed Altammami, Shabnam Karim, Nasser Almulhim or Ivana Cicic.
Publication
On September 18, 2024, the "Decree amending the list that sets forth goods whose import and export are subject to regulation by the Ministry of Energy" (the "Decree") was published in the Federal Official Gazette.
Publication
On September 18, 2024, the "Decree amending the list that sets forth goods whose import and export are subject to regulation by the Ministry of Energy" (the "Decree") was published in the Federal Official Gazette.
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