New-accounting-policies-require-the-insurance-companies-and-restrict-their-investment-allocations

: 1/12/2011

Wednesday, January 12, 2011


H.E. Fatima Mohammed Ishaq Al Awadi, Deputy Director General of the Insurance Authority, said: “the new accounting policies, which are expected to be completed during the first quarter of the present year, restrict the investments of the insurance companies and determine certain percentages of the premiums allowed to be invested in the economic sectors. The draft policies also include determining a certain percentage of the premiums allowed to be invested by the company in each sector”. She indicated that the draft policies still need the approval of the Ministry before final approval.

 

Al Awadi added that the draft policies aim at maintaining the financial solvency of the insurance companies in a manner to guarantee maintaining the rights of shareholders and policyholders at the same time. She indicated that the draft policies will oblige the companies to take technical provisions and financial reserves that boost their financial solvency.

 

She indicated that determining a percentage of the premiums allowed to be invested will spare the companies further losses arising from investing in the stock and real estate markets and it will drive them to concentrate on developing their technical operations by expanding the products and improving the standard of services delivered to the clients.​

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