Onshore Energy Conference — Dubai Onshore Energy Conference — Dubai 02 | Page 27
TRANSLATION ISSUES
the question that must be asked is whether
the use of international market wordings
does in fact result in greater certainty in the
context of KSA insurance, or is a new approach
required? This article considers some of the
issues that are relevant to this question and,
although focused on KSA, it is of broader
relevance as similar issues arise throughout
most of the jurisdictions in the Middle East.
T
he insurance industry has long
sought contract certainty through
the development of standard market
wordings. The underwriting of large
non-personal lines risks in the Kingdom of
Saudi Arabia (KSA) is no different as various
well-known market wordings, particularly
London market wordings, are commonly used.
The lack of local wordings can be understood
as the KSA insurance market is still heavily
reliant on foreign reinsurance support, and
foreign reinsurers naturally wish to underwrite
on the basis of familiar wordings. However,
The direct impact
of the KSA regulatory regime
KSA’s insurance regulator, the Saudi Arabian
Monetary Authority (SAMA), has enacted
various instructions and regulations that
have a direct general impact on insurance.
There are also SAMA regulations that apply
to specific lines of business (as defined and
identified by the regulations). Notwithstanding
the existence of specific regulations, in our
experience, a number of the regulations
that impact directly on the onshore energy
insurance business are not particularly
well-known such as, say, the September 2016
circular in relation to “Engineering Insurance”
(the Engineering Insurance Guidance).
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