Two regulations formulated under the Maldives Insurance Act to facilitate its implementation have come into force.

Formulated by the central bank, Maldives Monetary Authority (MMA), the two regulations comprise the Regulation on Insurable Risks in the Maldives and the General Insurance Regulation.

The Regulation on Insurable Risks specifies what constitutes local insurable risks and outlines conditions under which exemptions may be granted from the requirement to obtain coverage under an insurance policy from a licensed insurance company operating in the Maldives.

In addition to circumstances published on the Authority’s website, the regulation details situations under which applications for exemption may be submitted to the MMA.

Furthermore, the regulation sets out the procedures to follow when negotiating and obtaining insurance policies from unlicensed entities to cover insurable risks located in the Maldives.

The risks classified under the specific regulation include risks to movable and immovable property (including land located within Maldivian territory), risks concerning resident individuals, liability risks associated with property or persons residing in the Maldives, and risks relating to businesses legally registered in the Maldives.

The General Insurance Regulation defines the parameters within which legally authorized entities may solicit insurance business in the Maldives, the criteria for issuing insurance broker licenses, the information required to apply for a broker license, and the procedures for taking administrative action under the Insurance Act.

The regulation also stipulates general licensing conditions, requirements for licensing insurance company branches and subsidiaries, mandatory security deposits required from insurance companies, and procedures for establishing insurance funds.

Under this regulation, every insurance company operating in the Maldives is required to maintain a security deposit of MVR 2 million.