CMA sets up fund for insurance obligations

The Capital Markets Authority (CMA) has set up a new emergency fund for companies that are unable to fulfill their insurance obligations to their employees.

A statement from the CMA said : “The fund shall assist the parties in the event that the company fails to meet its obligations.” The same is highlighted under Article 7 of the guidelines for the fund: the finances for this fund will come from four sources. A fee of 0.25 percent will be levied from life and family insurance policies, with the money earned from this fee going towards the fund. In addition, a one percent fee will be placed on general insurance policies to provide more sources of money for this fund, according to a Times of Omanreport.

The CMA will also invest the money present in this fund to generate returns on them, while donations, grants and other resources that have been sent to the fund will also be added to this, once determined by the fund board.

“The fund controls the procedures for the disbursement of aid to the concerned parties,” added the CMA.

“A company that has failed to meet its obligations to the parties must provide the Committee with the following: a statement of valid insurance policies, a statement of the value of claims for outstanding insurance policies, and a statement of the names of the parties whose insurance dues have not been paid in whole or in part.”

In addition, the CMA said that companies in question must “disclose the values of liquidation of life insurance and family insurance linked to investment, as well as any other documents or statements required by the committee.”

In addition, the total amount of assistance provided for claims incurred by a single company shall not exceed 30 percent of the money available to the fund, according to Article 17, while in case there is a deficiency of funds in more than one company, the total assistance provided by the fund shall not exceed 60 percent of the fund’s available monies.