The Capital Market Authority (CMA) issued a regulation for marketing insurance products through banks as part of the efforts to provide adequate protection to policyholders.

The regulations are aimed at curbing unhealthy practices involved while marketing such products through banks and also to reduce disputes between the holder of the insurance policy related to the banking sector and companies during insurance claims.

CMA said banks are an important marketing channel to enhance the spread of insurance products, which are an essential part of the financial system, due to their geographical reach and wide networks.

As per the regulation, the insurance companies are not permitted to market any insurance product through the bank except after obtaining approval from the CMA.

It is not permissible for more than one company to market the same insurance product with the same bank, or for the same branch of the bank.

The regulations obligate insurance companies to retain a percentage of not less than 40 percent of the net premiums for insurance products marketed through banks, excluding the product of life insurance, property insurance, and insurance products related to small or medium enterprises it is permissible to keep a percentage of no less than 25 percent.

On the other hand, the regulations give the CMA the right to supervise and control the processes of selling and marketing products through provisions such as internal auditing that will notify any violations and setting controls to ensure that the executives employed for marketing insurance products via banks stick to the provisions of the anti-money laundering Law and terrorism financing.

Oman Daily Observer