The Bahrain Monetary Agency (BMA) has issued a consultation paper, setting out proposed rules and guidance on reporting requirements for insurers and enforcement measures.
The rules detail reporting requirements, including public disclosure, as well as the various enforcement measures available to the BMA to ensure the industry’s compliance with insurance legislation and regulations.
For insurers’ reporting requirements, BMA has specially tailored its rules for each type of insurance activity being conducted in Bahrain. The proposed rules take into account the different levels of risk and the relationship between various types of insurance licensees (such as insurance firms and insurance brokers) and policyholders.
The rules on public disclosure highlight the importance of financial transparency so that policyholders, potential policyholders and other interested parties, such as analysts and reinsurers, can gain a better understanding of insurance firms and intermediaries to assist them in making decisions in relation to these firms.
The enforcement measures propose a range of possible mechanisms. BMA will usually resort to the toughest enforcement measures only sparingly, preferring instead to develop a cooperative approach to enforcement with licensees.
“The BMA believes in a transparent approach to its supervisory role in ensuring that the insurance industry complies with applicable insurance legislation and regulations,” said Mr. Anwar Khalifa Al Sadah, Executive Director, Financial Institutions Supervision, at the BMA.
© 2004 Mena Report (www.menareport.com)
