Insurers, reinsurers and brokers must implement comprehensive risk management

Insurers, reinsurers and brokers in Saudi Arabia must have comprehensive risk management in place according to new regulations due to come into effect later in the month.

The Saudi Arabian monetary agency’s insurance supervision department published a risk management Code due to come into effect on January 18.

The Code presents the general principles and minimum standards that should be met by insurance businesses. The objective is to promote high standards of risk management, said the Saudi regulator.

The regulations require that companies assign at least two risk management officers.

Insurers, reinsurers and brokers are also required to define the risk management responsibilities of senior management, develop a contingency plan, provide the monetary agency with risk reports and establish internal controls to monitor their compliance.

Breaches of the Code would subject companies to enforcement action, warned the Saudi authority.