United Arab Emirates

By Bashir Ahmed, Saurbh Kothari and Deniz Ghazal | March 7, 2019

The AuthorsBashir Ahmed

Bashir Ahmed
Managing Partner
bahmed@afridi-angell.com
Tel: +971 4 330 3900

Saurbh Kothari

Saurbh Kothari
Senior Associate
saurbh@afridi-angell.com
Tel: +971 4 330 3900

Deniz Ghazal

Deniz Ghazal
Knowledge Manager
dghazal@afridi-angell.com
Tel: +971 4 330 3900

On January 6, 2019, UAE Cabinet Resolution No. 7 of 2019 Concerning the Administrative Fines Imposed by the Insurance Authority was published in the UAE Official Gazette, which lists a total of 204 items that are considered to be violations by the Insurance Authority and their corresponding penalties. This resolution will come into force on April 6, 2019 and will apply to any person, company or insurance–related professional* that commits any of the violations listed in the resolution.

The violations set out in the resolution are broad in range and generally cover, among other things, the following:

  • the failure to comply with the various regulations applicable to insurance providers and decisions issued by the Insurance Authority, including the UAE Financial Regulations;
  • the performance of insurance-related or reinsurance activities or the opening of a branch within onshore UAE without obtaining the Insurance Authority’s approval or the necessary licence; and
  • the failure to provide the Insurance Authority with the required data, documentation, reports and notifications within the specified periods of time.

Most of the administrative fines range from Dh5,000 to Dh250,000 per violation. One exception is when a company opens a point of sales for insurance products without being licensed and registered with the Insurance Authority. This fine is Dh50,000 for each point of sales. The amount of any administrative fine may be doubled if a violation is repeated within one year from the date of the last violation with a maximum fine amount of Dh2 million.

Any of the administrative fines issued by the Insurance Authority may be appealed within 15 days from the date of the notification of the fine and the appeal must be decided by the Insurance Authority’s board of directors within 60 days from the date that the appeal is submitted.

Insurance and reinsurance providers should review the resolution and the list of violations to ensure their compliance prior to the resolution’s effective date and should also continue to monitor their compliance accordingly going forward.

The complete list of violations and administrative fines included in Cabinet Resolution No. 7 of 2019 can be accessed on the Insurance Authority’s website.

For more information, please contact the professionals listed in the column above, or your regular Afridi & Angell contact. ■

* An insurance-related professional is defined in the resolution as any entity or person that is licensed by the Insurance Authority to practice as an insurance agent, actuary, insurance broker, loss and damage adjuster, insurance consultant, health insurance TPA or any other insurance-related profession regulated by the Insurance Authority.

Afridi & Angell

Founded in 1975, Afridi & Angell is a full-service UAE law firm in its fifth decade at the forefront of the legal community. From the beginning, our hallmarks have been a commitment to quality, unsurpassed knowledge of the law and the legal environment, and crafting of innovative business solutions. Licensed in the three largest Emirates of Abu Dhabi, Dubai and Sharjah as well as the Dubai International Financial Centre, our practice areas include banking and finance; corporate and commercial law; arbitration and litigation; construction; real estate; infrastructure projects; energy; project finance; maritime (wet and dry); and employment. We advise local, regional and global clients ranging in size and sophistication from start-ups, sole proprietorships, family-owned businesses, entrepreneurs and investors to some of the world’s largest public and private companies, governments and quasi- government institutions. We attract and retain clients with our dedication to practical guidance focused on their business needs supported by decades of experience here in our home jurisdiction, the UAE.

Afridi & Angell is the exclusive member firm in the UAE of top legal networks and associations, most notably Lex Mundi, the world’s leading network of independent law firms, and World Services Group.

www.afridi-angell.com

 

Afridi & Angell’s Legal Alert provides a brief overview and commentary on recent legal announcements and developments. Comments and opinions contained herein are general information only. They should not be regarded or relied upon as legal advice.

© 2019, Afridi & Angell

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