CMA says the cancellation decisions are formalities for  listing  companies under one name

In response to the news trending in the social media that the CMA has cancelled the licenses of three insurance companies, CMA would like to explain that to protect the rights of policyholders  and stakeholders  the market is witnessing during this period mergers of  insurance companies namely Arabian Insurance company and Falcon Insurance under the name “Arabian Falcon” and the merger of Muscat Insurance and Muscat Life Insurance and  in preparation for listing and Initial Public Offering as  CMA sees such mergers as step forward which would  contribute to creation of larger financial entities able to encounter market volatility and to cover larger risks.

The move comes in response to the latest amendments to Insurance Companies Law under Royal Decree No. 37/2014 which require increasing the capital from RO 5 million to RO 10 million as well as requiring the national insurance companies to convert into public joint stock companies through offering part of their capital in public offering. The amendments granted the companies a three year grace period to adjust their status according to the new requirements.

CMA would like to explain   that the cancellations  of the merged companies was a formality to grant the entities new licenses  and that the rights of policyholders and stakeholders with such companies  will not be affected and the merger processes would not have any impact on the insurance premiums prices.

According to the recent amendments and decisions  the number of licensed insurance companies will be 10 national companies and  10 branches of foreign  companies in addition to one reinsurer. The number was previously 23.

CMA as regulator  and supervisor of the insurance sector would like to emphasize that  it works to furnish attractive environment through encouraging merger processes to create big blocks  with strong financial  positions which would enhance the abilities of such companies to underwrite new risks and to increase retention ratios in the local market to encounter future risk and to contribute to the development and upgrading of the performance and the GDP of the Sultanate.