Kuwait - MPs approve insurance law
Friday, 05 17 2019, Category: Insurance and Reinsurance, Country: Kuwait
The National Assembly yesterday approved a new insurance law and amendments to the tenders law in the first reading amid calls by MPs that the insurance sector must come under the Central Bank or continues under the Commerce Ministry. Speaker Marzouk Al-Ghanem said the Assembly will hold a secret session today to debate regional developments amid heightened Iran-US tensions and the escalation following drone attacks by Yemen’s Houthi rebels against Saudi oil targets.
Commerce and Industry Minister Khaled Al-Roudhan said that Kuwait badly needs a new insurance law especially that the existing legislation was issued some 60 years ago and it was amended for the last time in 1981. He said the existing law does not include supervisory tools and the new one has tackled all the negative aspects in the insurance sector, adding that Kuwait was the first Gulf state to regulate its insurance sector but is the last to implement latest developments.
The minister said that 39 insurance companies are operating in the country, 28 of them are Kuwaiti and the rest are foreign. Together, the insurance companies are dealing with around KD 13 billion. MP Saleh Ashour called for the insurance sector to be under the supervision of the Central Bank and opposed the proposal to establish an independent body for the insurance sector.
Ashour said the new law increases the capital of insurance companies to between KD 5 and 15 million which will impact existing companies. MP Safa Al-Hashem criticized insurance companies describing them as “sharks” – claiming the new law favors the companies at the expense of the insured. MP Abdullah Al-Kundari criticized the law saying it does not provide sufficient protection for those insured and encourages monopoly for some companies besides that it does not encourage competition.
MP Saadoun Hammad said that the law does not require foreign companies to comply with the capital requirements as the Kuwaiti insurance companies and called for imposing the law on foreign companies wishing to open in Kuwait. At the end of the debate, 34 lawmakers voted for the law against 13. The second reading will be debated following the introduction of several changes.
Source: Kuwait Times