The Insurance Authority has issued a raft
of new regulations for Islamic and conventional insurers in the UAE,
including limits on what types of investments can be made, to shore up
their financial strength amid stock market volatility and falling oil
prices.
The rules regulate the financial, technical, investment
and accounting operations of “Traditional and Takaful insurers operating
in the UAE”, said a statement from the authority on Monday.Rima Mrad, a partner at the law firm Bin Shabib & Associates which helped to advise the regulator on the new rules, said on Monday that the Insurance Authority has over the past three years been reviewing the financial statements of insurance companies, the type of investments made, how they were exposed financially and the risks for operating in the UAE.
“After the 2008 crisis they noticed a lot of companies reporting losses for investing in real estate and equity and that rang the alarm for a huge need to strengthen the regulatory framework,” she said.