• The following words and phrases shall have the meanings set forth opposite each of them wherever they appear herein, unless the context requires otherwise:

  • 1.1 The Bank: The Saudi Central Bank (SAMA).
  • 1.2 The Rules: The rules regulating banking insurance operations.
  • 1.3 The Company: The insurance company licensed to practice insurance activities in accordance with the provisions of the Cooperative Insurance Companies Control Law.
  • 1.4 The Bank: Any bank licensed to practice banking activities in the Kingdom in accordance with the provisions of the Banking Control Law.
  • 1.5 Banking Insurance Operations: Marketing and distributing insurance products through the bank to its clients based on the agreement concluded between the bank and the company.
  • 1.6 The Agreement: A contract whereby the company and the bank agree that the bank will carry out banking insurance operations.
  • 1.7 The Authorized Employee: The bank employee(s) designated in agreement with the company to carry out banking insurance operations.
  • 1.8 The Client: The natural or legal person who deals with the bank.

These Rules shall apply to all Bancassurance Activities. The Cooperative Insurance Companies Control Law, its Implementing Regulation, the Banking Control Law and SAMA’s relevant regulations, rules, and instructions, and relevant laws and regulations issued by other authorities shall govern whatever is not provided for therein and to the extent possible.

The objective of these Rules is to regulate Bancassurance Activities and practices in Saudi Arabia and the relationship between the Company and the Bank in this regard.

• 1. The practice of bancassurance activities shall be conducted directly through the bank, whereby a marketing and distribution channel for the company is established, and the contractual relationship between the company and the bank - within the framework of practicing bancassurance activities - shall not include an insurance agency, insurance brokerage, insurance consultancy, or any of the professions related to insurance.
• 2. The company and the bank must sign an agreement before the bank practices bancassurance activities.
• 3. The company and the bank must obtain the prior approval of the bank before concluding the agreement.
• 4. The agreement must include at least the following:
  • A) Duration of the agreement.
  • B) Cases and procedures for terminating the agreement.
  • C) Specification of electronic and non-electronic marketing and distribution channels through which bancassurance activities will be practiced.
  • D) Training plan for the specialized employees.
  • E) Procedures for applying the Know Your Customer principle.
  • F) Compliance procedures.
  • G) Branches and insurance products to be marketed and distributed.
  • H) Marketing and distribution procedures.
  • I) Procedures for collecting insurance premiums.
  • J) Specification of the bank’s commission, how it is calculated, its due date, and collection procedures.
  • K) Customer care and complaint resolution.
  • L) Procedures for receiving and transferring claims to the company.

• 1- The bank shall be fully responsible for the conduct of the employees specialized in banking insurance activities, and it must ensure that the activities are practiced in accordance with the bank’s instructions and principles of transparency, as follows:

  • 1.1 Ensuring compliance with the terms of the agreement and the procedures contained therein across all the bank’s marketing and distribution channels, and establishing appropriate internal controls and procedures to ensure adherence to the relevant systems, regulations, and rules.

  • 1.2 Maintaining records that demonstrate the bank’s compliance with the provisions of paragraph (1.1).

  • 1.3 Preparing compliance reports on the banking insurance activities agreed upon with the company.

  • 1.4 Ensuring adherence to the limits of insurance policies permitted to be marketed and distributed in accordance with the agreement.

  • 1.5 Maintaining the confidentiality of the company’s and its clients’ data, records, and information.

  • 1.6 Allowing the company to review and audit all the bank’s books and records related solely to banking insurance activities or to obtain copies thereof,

  • The following records shall be prepared:

    • 1. Correspondence register.
    • 2. Internal records.
    • 3. Customer complaints log.

  • 2- The bank shall establish an administrative unit concerned with banking insurance, with governance controls specific to the bank determining its operational procedures, and its tasks and responsibilities shall include at least the following:

    • A) Supervising the bank’s electronic and non-electronic marketing and distribution channels.
    • B) Conducting training courses for specialized employees.
    • C) Establishing procedures for monitoring and verifying that the marketing and distribution of insurance products are conducted honestly, transparently, and fairly.

  • 3- The unit specialized in banking insurance must be supervised by an employee with sufficient experience, whom the bank employs to hold the position of director of the administrative unit specialized in banking insurance after obtaining the bank’s no-objection.

  • 4- Banking insurance activities shall be conducted through the bank’s electronic and non-electronic marketing and distribution channels.

  • 5- The bank must ensure that all specialized employees obtain the Certificate of Fundamentals of the Insurance Profession and any other certificate determined by the bank.

  • 6- The bank must obtain the company’s approval when it wishes to expand the electronic and non-electronic marketing and distribution channels through which banking insurance activities will be conducted, with notification to the bank thereof.

  • 7- The bank is not permitted to conduct banking insurance activities with non-clients.

• 1. The Company shall perform and not assign any of the following authorities to the Bank:

  • a. Make any amendments to the insurance policies or its annexes.

  • b. Settlement of claims.

  • c. Payment of compensation.

• 2. Obtain SAMA’s approval before any material amendments to the Agreement between the Company and the Bank.

• 3. The Company shall provide SAMA with an annual training plan for the Authorised Employees, provided that it includes -at a minimum- the following:

  • a. Training on marketing and distribution techniques;

  • b. Workshops to introduce insurance products; and

  • c. Training on anti-money laundering and counterterrorist financing.

• 4. Maintain the confidentiality of the data and information of the Bank and its Clients.

• 5. The Company shall regularly review the Bank’s practice of Bancassurance Activities, whether through Bank’s electronic or non- electronic channels.

• 6. The Company shall pay the Bank the marketing and distribution of insurance products’ commission as a result of carrying out Bancassurance Activities during the period specified in the Agreement, provided that the commission is in line with SAMA;s instruction.

The Bank is prohibited from requiring the Client to obtain banking products in order to get the insurance products or vice versa, unless the insurance coverage is binding by a competent authority

The Company may sign an Agreement with one Bank or more, and the Bank may sign an Agreement with one Company or more.