Tuesday, 15 January 2008
By Adel Al-Malki
JEDDAH - Many unlicensed insurance companies operating in the Kingdom will have to close their doors and stop their activities beginning Tuesday. This after the Saudi Arabian Monetary Agency (SAMA) issued a deadline for insurance businesses to amend their operations, relative to the monetary authority's issuance of the draft market code of conduct regulation for insurance companies and insurance service providers in Saudi Arabia.
A SAMA source told Saudi Gazette that insurance documents of unlicensed firms will be canceled by March 11, in which case policyholders must be informed by letters and their money refunded as well.
Insurance companies which want to stop activities must provide SAMA a withdrawal plan and should include a comprehensive report of all existing obligations, the source added.
SAMA's director of insurance supervision Mohammad A. Al-Shayea on Jan. 5 requested all insurance companies, insurance service providers and the public to provide a written response or comments to the draft code within 60 days of its publication.
The draft code, among others, aims to institutionalize "the general principles and minimum standards that should be met by insurance companies, including branches of foreign insurance companies, and insurance service providers licensed by SAMA in their dealings with their existing and potential customers."