The Saudi Insurance Authority announced the approval of the Licensing Requirements for the Underwriting Activities, as part of its ongoing efforts to develop the regulatory frameworks of the insurance sector and enhance the efficiency of professional practices, supporting market stability and improving governance standards.
Underwriting is considered one of the core professional functions in the insurance sector, involving the assessment of insured risks, the establishment of coverage terms, and the determination of appropriate premiums. This process contributes to disciplined pricing practices and enhances effective risk management.
The Regulation sets out a number of regulatory requirements for practicing underwriting activities, including obtaining a license from the Authority prior to commencing operations, maintaining a registered office within the Kingdom of Saudi Arabia, and having a minimum capital of SAR 1,000,000. Additional requirements include holding professional liability insurance of at least SAR 3,000,000, employing qualified professionals with specialized underwriting expertise, complying with governance, compliance, and risk management standards, and providing a clear organizational structure and business plan when applying for the license.
The Regulation also outlines clear procedures for submitting licensing applications, which include providing statutory documents, a business plan, financial study, and adherence to regulatory requirements. The Authority will review and process applications within the specified timeframes.
This Regulation will contribute to organizing the practice of underwriting by insurance companies and Managing General Agencies (MGAs) by establishing clear licensing requirements, ensuring higher quality professional practices and enhancing market transparency.
It also aims to enable licensed entities to conduct underwriting activities within an integrated regulatory framework that promotes sector development, improves the quality of insurance services, and supports growth in alignment with the objectives of Vision 2030.
The Authority is preparing to receive license applications to practice underwriting activities in accordance with the provisions and requirements contained in the approved regulations.
The Insurance Authority reaffirmed its commitment to continuously developing the sector's regulatory environment and enhancing professional competence across all insurance disciplines, thereby enabling entities to provide exceptional insurance services, strengthening market confidence, and supporting sustainability.