Saudi Arabia: Crackdown on fraudulent & unauthorised insurance sales
Source: Middle East Insurance Review | May 2019
Action is being taken to curb the issuance of insurance policies by unauthorised parties and to raise public awareness about purchasing cover from legitimate insurers, agents and accredited intermediaries.
An alliance has been formed between government agencies and insurers that raises public awareness and issues warnings to the public against fraud and falling victim to persons who are not licensed to engage in insurance activities, according to local media reports.
In particular, the warnings focus on vehicle and health insurance policies, which represent the largest share of the local insurance market.
The Saudi Arabian Monetary Authority (SAMA) was the first to launch the warnings which were issued after the regulator noted irregular practices by a number of unlicensed entities, such as some service offices and at vehicle and street sales fairs, which perpetuate many forms of fraudulent insurance sales.
The irregular practices include the unauthorised parties making false statements in insurance application forms that the client is unaware of until he makes a claim. M