Saudi Arabia: Insurance Authority expected to draft national strategy for the industry
Source: Middle East Insurance Review | Oct 2023
The proposed Insurance Authority (IA) is expected draft the National Strategy for the Insurance Sector to be in line with other National Strategies such as National Investment Strategy and other programmes within Vision 2030 of the Kingdom of Saudi Arabia (KSA), according to insights provided by the global law firm Clyde & Co.
A report titled “Establishment of the Insurance Authority in the Kingdom of Saudi Arabia” by Clyde & Co said, “We anticipate that one of the strategy initiatives will be improving the regulatory and investment environment for the insurance sector to attract foreign investments.”
The establishment of the IA along with the National Strategy for the Insurance Sector are significant milestones to increase the growth in the insurance industry in KSA for it to become the largest market in the region.
The report said that the IA is expected to focus on strengthening the existing regulatory environment to address challenges in the insurance sector in KSA and work on applying higher international standards to ensure further development and growth.
This is to meet a target set in the Financial Sector Development Programme (FSDP), which is to enable financial institutions to support the growth of the private sector through the development of the insurance sector to manage financial risks.
The IA’s strategy is also likely to focus on increasing companies’ ability to accept risks, in addition to providing innovative technical solutions that contribute to facilitating the experience of beneficiaries and stakeholders, said the report.
The establishment of the IA is expected to enhance the mandated supervision of the insurance sector in KSA and ensure growth and development through unifying the regulators SAMA and the Council of Health Insurance.
The IA has been granted several authorities to exercise all competencies and responsibilities related to the insurance sector as stipulated in the Cooperative Health Insurance Law and the Cooperative Insurance Companies Control Law. The current regulations, rules and instructions issued based on the Cooperative Insurance Companies Control Law and the Cooperative Health Insurance Law, shall continue to be in effect until the completion of the legal procedures regarding the insurance draft law and its enforcement.
It is expected that the IA will be taking charge of a legal reform starting from issuing the new Insurance Law followed by implementing regulations. M