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Dubai Financial Services Authority (DFSA): Contents

Dubai Financial Services Authority (DFSA)
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  • COB 7 Core Rules — Insurance

    • COB 7.1 Application and Interpretation

      • COB 7.1.1

        (1) The RulesG in this chapter apply to an Authorised FirmG with respect to the conduct in or from the DIFC of Insurance BusinessG , Insurance IntermediationG or Insurance ManagementG to the extent specified in any Rule.
        (2) The RulesG in this chapter do not apply to an InsurerG that is an Authorised ISPVG with the exception of the Rules in COB section 7.2.
        (3) Only COB section 7.2, COB Rules 7.3.1, 7.6.1 and 7.9.1 and COB sections 7.10 and 7.12 in this chapter apply to an InsurerG , Insurance IntermediaryG or Insurance ManagerG when it carries on a Financial ServiceG with or for a Market CounterpartyG .
        Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]
        [Amended] DFSA RM182/2016 (Made 19th June 2016) [VER27/08-16]

      • COB 7.1.2

        In this chapter, unless otherwise stated, a reference to an "insurer" is a reference to both an InsurerG and a Non-DIFC insurerG .

        Derived from DFSA RM182/2016 (Made 19th June 2016) [VER27/08-16]

      • COB 7.1.3

        (1) In this chapter, unless otherwise stated, a reference to a ClientG of an Insurance ManagerG is a reference to:
        (a) an insurer to whom the Insurance ManagerG provides its Insurance ManagementG services; and
        (b) a PolicyholderG with whom the Insurance ManagerG interacts when carrying out its Insurance ManagementG activities.
        (2) In COB section 7.12, when an Insurance ManagerG provides Insurance ManagementG services to a Captive InsurerG , a reference to a ClientG in (1)(a) is a reference to:
        (a) the Captive InsurerG ;
        (b) any shareholder of the Captive InsurerG ; and
        (c) any PersonG on whose behalf the Insurance ManagerG undertakes to establish that PersonG as an insurer.
        (3) In (2):
        (a) a Captive InsurerG includes a CellG of a Protected Cell CompanyG which is an InsurerG ; and
        (b) a shareholder includes a holder of Cell SharesG .
        Derived from DFSA RM182/2016 (Made 19th June 2016) [VER27/08-16]

      • Guidance

        The Rules in this chapter apply to Authorised FirmsG conducting Insurance BusinessG and Insurance ManagementG in relation to all classes of Contracts of InsuranceG . However, those Rules apply to Authorised FirmsG conducting Insurance IntermediationG only in relation to Contracts of InsuranceG that are not contracts of Long-Term InsuranceG . Other COB Rules relating to the Financial ServicesG of Advising on Financial Products or CreditG and Arranging Credit or Deals in InvestmentsG will apply to advising and arranging on contracts of Long-Term InsuranceG .

        Derived from DFSA RM182/2016 (Made 19th June 2016) [VER27/08-16]

    • COB 7.1A Table Illustrating the Application of the Rules in this Chapter

    • COB 7.2 Insurance Business, Management and Intermediation Restrictions

      • COB 7.2.1

        An Authorised FirmG may only conduct Insurance BusinessG or Insurance IntermediationG with or for a ClientG to the extent specified in this section.

        Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]

      • COB 7.2.2

        (1) An InsurerG must ensure that it does not EffectG a Contract of InsuranceG or Carry OutG a Contract of InsuranceG through an establishment maintained by it in the DIFCG where the contract is in relation to a risk situated within the StateG , unless the risk is situated in the DIFCG , or the contract is one of re-insurance.
        (2) An Insurance IntermediaryG must ensure that it does not act as agent in relation to a Contract of InsuranceG where the contract is in relation to a risk situated within the StateG , unless the risk is situated in the DIFCG , or the contract is one of reinsurance.
        (3) An Insurance ManagerG must ensure that it does not act in relation to a Contract of InsuranceG where the contract is in relation to a risk situated within the StateG , unless the risk is situated in the DIFCG , or the contract is one of re-insurance.
        [Amended] DFSA RM61/2008 (Made 4th January 2009) [VER15/01-09]
        Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]
        [Amended] DFSA RM182/2016 (Made 19th June 2016) [VER27/08-16]
        [Amended] DSFA RM185/2016 (Made 7th December 2016). [VER28/02-17]

        • COB 7.2.2 Guidance

          The classes of insurance are set out in GEN App4. These include both insurance and reinsurance contracts relating to life insurance and non-life insurance (such as accident, sickness, property and travel insurance). However, the prohibitions in COB Rule 7.2.2 only apply to a Contract of InsuranceG that is not a contract of re-insurance.

          Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]
          [Amended] DFSA RM182/2016 (Made 19th June 2016) [VER27/08-16]
          [Amended] DSFA RM185/2016 (Made 7th December 2016). [VER28/02-17]

      • COB 7.2.3

        An InsurerG must ensure that it does not carry on, through an establishment maintained by it in the DIFC, both Long-Term Insurance BusinessG and General Insurance BusinessG unless the General Insurance BusinessG is restricted to Class 1G or Class 2G or both.

        Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]

      • COB 7.2.4

        An InsurerG which is a Protected Cell CompanyG must ensure that all Insurance BusinessG is attributable to a particular CellG of that InsurerG .

        Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]

      • COB 7.2.5

        An InsurerG must not carry on any activity other than Insurance BusinessG unless it is an activity in direct connection with or for the purposes of such business. For the purposes of this Rule, Managing AssetsG is not an activity in connection with or for the purposes of Insurance BusinessG .

        Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]

        • COB 7.2.5 Guidance

          1. The following activities will normally be considered in direct connection with or for the purposes of Insurance BusinessG carried on by an InsurerG :
          a. investing, reinvesting or trading, as investor or rabb ul maal and for the Insurer'sG own account, that of its SubsidiaryG , its Holding CompanyG or any SubsidiaryG of its Holding CompanyG but not any other party, in SecuritiesG , loans, investment accounts, units or shares in collective investment funds, certificates of mudaraba, certificates of musharaka or other forms of investments that are intended to earn profit or return for the investor;
          b. rendering other services related to Insurance BusinessG operations including, but not limited to, actuarial, risk assessment, loss prevention, safety engineering, data processing, accounting, claims handling, loss assessment, appraisal and collection services;
          c. acting as agent for another insurer in respect of contracts of insurance in which both insurers participate;
          d. establishing SubsidiariesG or AssociatesG engaged or organised to engage exclusively in one or more of the businesses specified above; and
          e. giving advice relating to its own Contracts of InsuranceG .
          2. The DFSA may give individual guidance on other business activities that may be determined to be in direct connection with Insurance BusinessG .
          Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]
          [Amended] DFSA RM182/2016 (Made 19th June 2016) [VER27/08-16]

      • COB 7.2.6

        An Insurance ManagerG must not underwrite on behalf of a Non-DIFC insurerG in relation to a Contract of InsuranceG with or for a Retail ClientG , unless the Insurance ManagerG has obtained the prior written approval of the DFSAG in respect of that insurer.

        Derived from DFSA RM182/2016 (Made 19th June 2016) [VER27/08-16]

        • COB 7.2.6 Guidance

          For the purposes of COB Rule 7.2.6, an Insurance ManagerG should submit to the DFSAG sufficient information to establish that the Non-DIFC insurerG for which it proposes to act is fit and proper and is subject to adequate regulation in its home jurisdiction.

          Derived from DFSA RM182/2016 (Made 19th June 2016) [VER27/08-16]

    • COB 7.3 Communication of Information and Marketing Material

      • General Obligation

        • COB 7.3.1

          (1) When communicating any information in relation to Insurance BusinessG , Insurance IntermediationG or Insurance ManagementG to a PersonG , an Authorised FirmG must take reasonable steps to ensure that the communication is clear, fair and not misleading.
          (2) An InsurerG , Insurance IntermediaryG or Insurance ManagerG must not, in any form of communication with a PersonG , including an agreement, attempt to limit or avoid any duty or liability it may have to that PersonG under legislation administered by the DFSAG .
          (3) An InsurerG or Insurance IntermediaryG must, when providing or directing marketing material to a ClientG , comply with the requirements in COB section 3.2, if the marketing material relates to a Direct Long-Term Insurance ContractG .
          Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]
          [Amended] DFSA RM154/2015 (Made 9th December 2015) [VER25/02-16]
          [Amended] DFSA RM182/2016 (Made 19th June 2016) [VER27/08-16]

    • COB 7.4 Client's Duty of Disclosure

      • COB 7.4.1

        An InsurerG or Insurance IntermediaryG must explain to a ClientG :

        (a) the Client'sG duty to disclose all circumstances material to the insurance both before the insurance commences and during the continuance of the policy; and
        (b) the consequence of any failure by the ClientG to make such disclosures.
        Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]

      • COB 7.4.2

        An Insurance IntermediaryG must explain to a ClientG that all answers or statements given on a proposal form, claim form or any other relevant document are the Client'sG own responsibility and that the ClientG is responsible for checking the accuracy of such information.

        Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]

      • COB 7.4.3

        If an Insurance IntermediaryG believes that any disclosure of material facts by a ClientG is not true, fair or complete, it must request the ClientG to make the necessary true, fair or complete disclosure, and if this is not forthcoming must consider declining to continue acting on that Client'sG behalf.

        Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]

    • COB 7.5 Authorised Firm's Duty of Disclosure

      • COB 7.5 Guidance

        If an Authorised FirmG is required to provide information to a ClientG or potential ClientG under this section or any other section in this Chapter before providing a service or doing anything, then the information should be provided in good time before providing the service or doing the thing so that the ClientG has sufficient time to make an informed decision.

        Derived from DFSA RM182/2016 (Made 19th June 2016) [VER27/08-16]

      • COB 7.5.1

        (1) An InsurerG , Insurance IntermediaryG or Insurance ManagerG must, subject to (3), disclose to a ClientG :
        (a) the name and address of the insurer or insurers effecting the ContractG of InsuranceG ;
        (b) its own name and address where different; and
        (c) contact details of the PersonG to whom a claim is to be notified.
        (2) The disclosures in (1) must be made before effecting or placing the ContractG of InsuranceG , or as soon as reasonably practicable thereafter.
        (3) An Insurance ManagerG is not required to make the disclosure under (1) to an insurer to whom it provides Insurance ManagementG services.
        Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]
        [Amended] DFSA RM182/2016 (Made 19th June 2016) [VER27/08-16]

      • COB 7.5.2

        (1) An Insurance IntermediaryG or Insurance ManagerG must, subject to (3), disclose to a ClientG if:
        (a) it has a direct or indirect holding representing 10% or more of the voting rights or capital in an insurer; or
        (b) an insurer, or its parent undertaking, has a direct or indirect holding representing 10% or more of the voting rights or capital in the Insurance IntermediaryG or Insurance ManagerG .
        (2) The disclosures in (1) must be made before providing Insurance IntermediationG or Insurance ManagementG services to the ClientG .
        (3) An Insurance ManagerG is not required to make a disclosure under (1) to an insurer to whom it provides Insurance ManagementG services.
        Derived from DFSA RM182/2016 (Made 19th June 2016) [VER27/08-16]

        • COB 7.5.2 Guidance

          An Insurance IntermediaryG or Insurance ManagerG is required to disclose the information under COB Rule 7.5.1(1) and COB Rule 7.5.2(1) to any PolicyholderG with whom it interacts when carrying out its Insurance IntermediationG or Insurance ManagementG activities.

          Derived from DFSA DFSA RM182/2016 (Made 19th June 2016) [VER27/08-16]

      • COB 7.5.3

        (1) An Insurance IntermediaryG must, before providing any Insurance IntermediationG service to a PersonG as a Retail ClientG , disclose whether any advice or information is or will:
        (a) be provided on the basis of a fair analysis of the market;
        (b) not be provided on the basis of a fair analysis of the market because of any contractual agreement it has with any particular insurer or insurers to deal with only their products; or
        (c) even if there are no contractual agreements of the type referred to in (b), not be provided on the basis of a fair analysis of the market.
        (2) If (1) (b) or (c) applies, the Insurance IntermediaryG must, if requested by the Retail ClientG , provide to that ClientG a list of insurers with whom it deals or may deal in relation to the relevant ContractsG of InsuranceG .
        (3) An Insurance IntermediaryG must, before providing any Insurance IntermediationG service to a ClientG , disclose to that ClientG whether it acts on behalf of an insurer or any other PersonG or acts independently on behalf of ClientsG .
        Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]
        [Amended] DFSA RM182/2016 (Made 19th June 2016) [VER27/08-16]

        • COB 7.5.3 Guidance

          1. An Insurance IntermediaryG should not represent itself as providing advice or information on the basis of a fair analysis of the market under COB Rule 7.5.3(1) unless it has considered a sufficiently broad range of ContractsG of InsuranceG and based its decision on an adequate analysis of those contracts.
          2. Insurance BrokersG act for ClientsG who are PolicyholdersG . In doing so, they may claim under COB Rule 7.5.3(3) that they act 'independently' for the ClientsG .
          3. The DFSAG expects an Insurance BrokerG which holds itself out to a ClientG as acting 'independently' for the ClientG to be able to demonstrate its independence to the DFSAG . Factors that the DFSAG would take into account when assessing if an Insurance BrokerG has acted independently include whether that broker:
          (a) has assessed a sufficiently large number of insurance products available on the market, and those products are sufficiently diverse in terms of their types and the issuers, to be able to suit the Client'sG needs and objectives;
          (b) is free to select insurance products from a sufficiently large number of insurers — for example, if a broker has close links with insurers, or exclusivity clauses in arrangements with insurers whose products they can select, the broker may not be able to claim it is independent; and
          (c) has disclosed clearly to the ClientG all commissions and other economic benefits it or a Group memberG receives from insurers with whom it places insurance.
          Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]
          [Amended] DFSA RM182/2016 (Made 19th June 2016) [VER27/08-16]

    • COB 7.6 Disclosure of Costs and Remuneration

      • COB 7.6.1

        An InsurerG , Insurance IntermediaryG or Insurance ManagerG must provide details of the costs of each ContractG of InsuranceG or Insurance IntermediationG service or Insurance ManagementG service offered to a ClientG .

        Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]

        • COB 7.6.1 Guidance

          1 The disclosure required by this Rule should include any premiums, fees, charges or taxes payable by the ClientG , whether or not these are payable to the Authorised FirmG .
          2 The disclosure should be made in terms readily understandable by the ClientG , taking into account the knowledge held by that ClientG in relation to the type of insurance in question.
          Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]

      • COB 7.6.2

        An InsurerG or Insurance IntermediaryG must, where any premium is payable through a Credit FacilityG made available to a Retail ClientG , disclose any interest, profit rate or charges payable by the ClientG for using that facility.

        Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]

      • COB 7.6.3

        An InsurerG , Insurance IntermediaryG or Insurance ManagerG must ensure that it does not impose any new costs, fees or charges without first disclosing the amount and the purpose of those charges to the ClientG .

        Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]

      • COB 7.6.4

        (1) An InsurerG , Insurance IntermediaryG or Insurance ManagerG must, on the request of any ClientG , disclose to that ClientG all commissions and other economic benefits accruing to the Authorised FirmG or any member of the same GroupG from:
        (a) any Insurance IntermediationG business;
        (b) any Insurance ManagementG business; or
        (c) any other business connected to or related to the provision of such business;
        transacted by the Authorised Firm on behalf of that Client.
        (2) The requirement to disclose the information under (1) does not apply where an Insurance IntermediaryG acts solely on behalf of a single insurer, and this fact has been disclosed to the ClientG .
        Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]

    • COB 7.7 Information About the Proposed Insurance

      • COB 7.7.1

        An InsurerG or Insurance IntermediaryG must provide adequate information in a comprehensive and timely manner to enable a ClientG to make an informed decision about the ContractG of InsuranceG that is being proposed.

        Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]

      • COB 7.7.2

        Without limiting the generality of the disclosure obligation under COB section 7.5, an InsurerG or Insurance IntermediaryG must, for the purpose of complying with the obligation under that section:

        (a) provide to a ClientG information about the key features of any insurance proposed including the essential cover and benefits, any significant or unusual restrictions, exclusions, conditions or obligations, and the applicable period of cover; and
        (b) explain, except where the insurance cover is sourced from a single insurer, the differences in and the relative costs of similar types of insurance as proposed.
        Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]

        • COB 7.7.2 Guidance

          When deciding to what extent it is appropriate to explain the terms and conditions of a particular insurance the InsurerG or Insurance IntermediaryG should take into consideration the knowledge held by the ClientG in relation to the type of insurance in question.

          Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]

      • Specific Disclosure for Long-Term Insurance

        • COB 7.7.3

          Where an InsurerG or an Insurance IntermediaryG proposes Direct Long-Term InsuranceG to a Retail ClientG , the disclosure for the purposes of this section must include:

          (a) the method of calculation of any bonuses;
          (b) an indication of surrender values and paid-up values, and the extent to which any such values are guaranteed;
          (c) for unit-linked insurance contracts, definition of the units to which they are linked, and a description of the underlying assets;
          (d) the basis of any projections included in the information; and
          (e) any facts that are material to the decision to invest, including risks associated with the investment and factors that may adversely affect the performance of the investments.
          Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]

      • [Deleted]

        [Deleted] DFSA RM69/2010 (Made 1st March 2010). [VER18/03-10]

        • COB 7.7.4 [Deleted]

          [Deleted] DFSA RM69/2010 (Made 1st March 2010). [VER18/03-10]

    • COB 7.8 Suitability

      • COB 7.8.1

        An InsurerG or an Insurance IntermediaryG must comply with the suitability requirement set out in COB section 3.4 when conducting any InsuranceG or Insurance Intermediation BusinessG with or for a Retail ClientG in respect of Direct Long-Term InsuranceG .

        Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]

      • COB 7.8.2

        (1) Subject to COB Rule 7.8.3, an InsurerG or Insurance IntermediaryG must only make a recommendation to a Retail ClientG to enter into a ContractG of InsuranceG that is General InsuranceG where it has taken reasonable steps to ensure that the recommended ContractG of InsuranceG is suitable in light of the Client'sG demands and needs.
        (2) The InsurerG or Insurance IntermediaryG must obtain from a Retail ClientG such information as is necessary to identify the Client'sG circumstances and objectives, and consider whether the terms of the particular contract of General InsuranceG meet the requirements identified.
        Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]

      • COB 7.8.3

        An InsurerG and an Insurance IntermediaryG may only recommend to a ClientG a contract of General InsuranceG that does not meet all the Client'sG requirements if it clearly explains to the ClientG , at the point of making the recommendation, that the contract does not fully meet the Client'sG requirements and the differences in the insurance recommended.

        Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]

        • COB 7.8.3 Guidance

          When deciding what level of explanation is appropriate for a ClientG to whom a contract of insurance that does not fully meet that Client'sG requirements is recommended, the InsurerG or Insurance IntermediaryG should take into consideration the knowledge held by the ClientG in relation to the type of insurance in question.

          Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]

      • COB 7.8.4

        Where an Insurance IntermediaryG is instructed to obtain insurance which is contrary to the advice that it has given to a ClientG , the Insurance IntermediaryG must obtain from the ClientG written confirmation of the Client'sG instructions before arranging or buying the relevant insurance.

        Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]

    • COB 7.9 Managing Conflicts of Interest

      • COB 7.9.1

        (1) An Insurance IntermediaryG or Insurance ManagerG must manage any conflict of interest to ensure that all its ClientsG are fairly treated and not prejudiced by any such interests.
        (2) An Insurance IntermediaryG or Insurance ManagerG must manage the conflict of interest by disclosing such conflict to the ClientsG in writing either generally or in relation to a specific TransactionG .
        (3) If an Insurance IntermediaryG or Insurance ManagerG is unable to manage a conflict of interest, it must decline to act for the ClientG .
        Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]

        • COB 7.9.1 Guidance

          1. An Insurance IntermediaryG , when considering how it manages conflicts of interests, should clearly identify the capacity in which it acts and to whom it owes duties. For example, if it is acting as an Insurance BrokerG , it is acting as an agent for the policyholder and it has a duty to act in the best interests of the policyholder. If it is acting as an Insurance AgentG , it has a duty to act in the best interests of its principal i.e. the insurer or insurers from whom it holds an authority to act as agent.
          2. While the Rules do not prohibit an Insurance IntermediaryG from acting for both an insurer and policyholder in relation to the same risk, such an arrangement could result in conflicts of interest that are hard to manage. If an Insurance IntermediaryG proposes to act for both an insurer and policyholder in relation to the same risk, it should, under COB Rule 7.9.1(2), clearly disclose that information in a timely manner. The DFSAG expects the firm to at least:
          a. notify both parties about the procedures it will follow if acting in the interest of the policyholder or the insurer is likely to impair its ability to act in the interests of the other party; and
          b. if one or both parties express concerns relating to the proposed process, decline to act for both parties under COB Rule 7.9.1(3) and instead act for only one party.
          3. An Insurance ManagerG will also need to identify and manage conflicts of interest that arise in the course of carrying on its business, for example, in the course of settling claims.
          Derived from DFSA RM182/2016 (Made 19th June 2016) [VER27/08-16]

    • COB 7.10 Placement of Insurance

      • Instructions

        • COB 7.10.1

          An Insurance IntermediaryG or Insurance ManagerG must not place a ContractG of InsuranceG with or on behalf of an insurer unless it has satisfied itself on reasonable grounds that the insurer may lawfully effect that contract under the laws of the jurisdictions in which the insurer and the risk are located.

          Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]
          [Amended] DFSA RM182/2016 (Made 19th June 2016) [VER27/08-16]

      • Quotations

        • COB 7.10.2

          When giving a quotation, an Insurance IntermediaryG or Insurance ManagerG must take due care to ensure the accuracy of the quotation and its ability to obtain the insurance at the quoted terms.

          Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]
          [Amended] DFSA RM182/2016 (Made 19th June 2016) [VER27/08-16]

      • Confirmation of Cover

        • COB 7.10.3

          (1) An InsurerG , in Effecting Contracts of InsuranceG , must promptly document the principal economic and coverage terms and conditions agreed upon under any Contract of InsuranceG and finalise such contract in a timely manner.
          (2) An InsurerG , Insurance IntermediaryG or Insurance ManagerG must, as soon as reasonably practicable, provide a ClientG with written confirmation and details of the insurance which it has effected for the ClientG or has obtained on behalf of the ClientG , including any changes to an existing ContractG of InsuranceG .
          (3) An InsurerG , Insurance IntermediaryG or Insurance ManagerG must, as soon as reasonably practicable, provide the ClientG with the full policy documentation where this was not included with the confirmation of cover.
          (4) In (2) and (3), a ClientG of an Insurance ManagerG is any PolicyholderG with whom the Insurance ManagerG interacts when carrying on its Insurance ManagementG activities.
          Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]
          [Amended] DFSA RM97/2012 (Made 24th July 2012) [VER20/07-12]
          [Amended] DFSA RM182/2016 (Made 19th June 2016) [VER27/08-16]

    • COB 7.11 Providing an Ongoing Service

      • Amendments to and Renewal of Insurance

        • COB 7.11.1

          (1) An InsurerG or Insurance IntermediaryG must deal promptly with a Client'sG request for an amendment to the insurance cover and provide the ClientG with full details of any premium or charges to be paid or returned.
          (2) An InsurerG or Insurance IntermediaryG must provide a ClientG with written confirmation when the amendment is made and remit any return premium or charges due to the ClientG without delay.
          Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]

        • COB 7.11.2

          An InsurerG or Insurance IntermediaryG must give adequate advance notification to a ClientG of the renewal or expiration date of an existing insurance policy so as to allow the ClientG sufficient time to consider whether continuing cover is required.

          Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]

        • COB 7.11.3

          On expiry or cancellation of the insurance, at the request of the ClientG , an InsurerG or Insurance IntermediaryG must promptly make available all documentation and information to which the ClientG is entitled.

          Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]

      • Claims

        • COB 7.11.4

          Where an Insurance IntermediaryG handles insurance claims it must:

          (a) on request, give the ClientG reasonable guidance in pursuing a claim under the relevant policy;
          (b) handle claims fairly and promptly and keep the ClientG informed of progress;
          (c) inform the ClientG in writing, with an explanation, if it is unable to deal with any part of a claim; and
          (d) forward settlement of any claim, as soon as reasonably practicable, once it has been agreed.
          Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]

        • COB 7.11.5

          An InsurerG must:

          (a) handle claims fairly and promptly;
          (b) keep the ClientG informed of the progress of the claim;
          (c) not reject a claim unreasonably;
          (d) if only part of a claim is accepted:
          (i) provide a clear statement about the part of the claim that is accepted; and
          (ii) give clear reasons for rejecting that part of the claim that has not been accepted; and
          (e) settle the claim promptly.
          Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]

    • COB 7.12 Insurance Monies

      • Application

        • COB 7.12.1

          This section applies to an Insurance IntermediaryG and an Insurance ManagerG , in respect of activities carried on in or from the DIFC.

          Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]

      • General

        • COB 7.12.2

          (1) Insurance MoniesG are, subject to (2), any monies arising from Insurance IntermediationG or the Insurance ManagementG business which are any of the following:
          (a) premiums, additional premiums and return premiums of all kinds;
          (b) claims and other payments due under ContractsG of InsuranceG ;
          (c) refunds and salvages;
          (d) fees, charges, taxes and similar fiscal levies relating to ContractsG of InsuranceG ;
          (e) discounts, commissions and brokerage; or
          (f) monies received from or on behalf of a ClientG of an Insurance ManagerG , in relation to his Insurance ManagementG business.
          (2) MoniesG are not Insurance MoniesG where there is a written agreement in place between the Insurance IntermediaryG or Insurance ManagerG and the insurer to whom the relevant monies are to be paid (or from whom they have been received) under which the insurer agrees that:
          (a) the Insurance IntermediaryG or Insurance ManagerG , as the case may be, holds as agent for the insurer all monies received by it in connection with ContractsG of InsuranceG effected or to be effected by the insurer;
          (b) insurance cover is maintained for the ClientG once the monies are received by the Insurance IntermediaryG or the Insurance ManagerG , as the case may be; and
          (c) the insurer's obligation to make a payment to the ClientG is not discharged until actual receipt of the relevant monies by the ClientG .
          Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]

          • COB 7.12.2 Guidance

            If an Insurance ManagerG does not have in place risk transfer arrangements referred to in COB Rule 7.12.2(2), the Insurance ManagerG holds Insurance MoniesG , so far as they belong to PolicyholdersG , at the risk of those PolicyholdersG .

            Derived from DFSA RM182/2016 (Made 19th June 2016) [VER27/08-16]

        • COB 7.12.3 [Deleted]

          [Deleted] DFSA RM182/2016 (Made 19th June 2016) [VER27/08-16]

        • COB 7.12.4 [Deleted]

          [Deleted] DFSA RM182/2016 (Made 19th June 2016) [VER27/08-16]

      • Insurance Money Segregation

        • COB 7.12.5

          (1) An Insurance IntermediaryG or Insurance ManagerG when dealing with Insurance MoniesG must:
          (a) maintain one or more separate Insurance Bank AccountsG with an Eligible BankG ;
          (b) ensure that each Insurance Bank AccountG contains in its title the name of the Authorised FirmG , together with the designation Insurance Bank AccountG (or IBA);
          (c) prior to operating an Insurance Bank AccountG , give written notice to, and request written confirmation from, the Eligible BankG that the bank is not entitled to combine the Insurance Bank AccountG with any other account unless that account is itself an Insurance Bank AccountG held by the Authorised FirmG , or to any charge, encumbrance, lien, right of set-off, compensation or retention against monies standing to the credit of the Insurance Bank AccountG ;
          (d) pay all Insurance MoniesG directly and without delay into an Insurance Bank AccountG ;
          (e) use an Insurance Bank AccountG only for the following purposes:
          (i) the receipt of Insurance MoniesG ;
          (ii) the receipt of such monies as may be required to be paid into the Insurance Bank AccountG to ensure compliance by the Authorised FirmG with any conditions or requirements prescribed by the DFSA;
          (iii) the payment to ClientsG or to insurers of monies due under Insurance Intermediation BusinessG transactions;
          (iv) the payment of all monies payable by the Authorised FirmG in respect of the acquisition of or otherwise in connection with Approved AssetsG ;
          (v) the withdrawal of brokerage, management fees and other income related to Insurance Intermediation BusinessG , either in cash or by way of transfer to an account in the name of the IntermediaryG which is not an Insurance Bank AccountG , provided that no such sum may be withdrawn from the Insurance Bank AccountG before the time at which that amount may be brought into account as income of the Insurance IntermediaryG ;
          (vi) the withdrawal of monies that are required to be transferred under (2) or COB Rule 7.12.9A;
          (vii) the withdrawal of monies paid into the Insurance Bank AccountG in error; and
          (viii) the withdrawal of any monies credited to the Insurance Bank AccountG in excess of those required by any conditions and requirements prescribed by the DFSA;
          (f) ensure that any amount held in the Insurance Bank AccountG or other Approved AssetsG , together with any amount due and recoverable from insurance debtors, is equal to, or greater than the amount due to insurance creditors; and
          (g) take immediate steps to restore the required position if at any time it becomes aware of any deficiency in the required segregated amount.
          (2) If an Eligible BankG has not provided the written confirmation referred to in (1)(c) within 40 business days after the Authorised FirmG made the request, the Authorised FirmG must as soon as possible withdraw Insurance Monies held in the Insurance Bank AccountG with that Eligible BankG and deposit them in an Insurance Bank Account with another Eligible Bank.
          (3) An Insurance IntermediaryG or Insurance ManagerG is not required to comply with the requirement in (1)(c) if it has no account, other than one or more Insurance Bank AccountsG , with the Eligible BankG .
          Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]
          [Amended] DFSA RM182/2016 (Made 19th June 2016) [VER27/08-16]

        • COB 7.12.6

          An Insurance IntermediaryG or Insurance ManagerG may not obtain a loan or overdraft for any purpose relating to an Insurance Bank AccountG unless that advance:

          (a) is on a bank account which is designated as an Insurance Bank AccountG , and the loan or overdraft is used for payment to ClientsG or to insurers of monies due under Insurance IntermediationG transactions;
          (b) does not give rise to a breach of the requirements of COB Rule 7.12.5(e); and
          (c) is of a temporary nature and is repaid as soon as reasonably practicable.
          Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]

        • COB 7.12.7

          An Insurance IntermediaryG or Insurance ManagerG must hold Insurance MoniesG either in an Insurance Bank AccountG or in Approved AssetsG .

          Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]

        • COB 7.12.8

          An Insurance IntermediaryG or Insurance ManagerG must ensure that Approved AssetsG are:

          (a) registered in the name of the Insurance IntermediaryG or Insurance ManagerG and designated as being an 'Insurance Bank Account'; or
          (b) held for the Insurance Bank AccountG of the Insurance IntermediaryG or Insurance ManagerG at the bank at which such Insurance Bank AccountG is held.
          Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]
          [Amended] DFSA RM182/2016 (Made 19th June 2016) [VER27/08-16]

        • COB 7.12.9

          An Insurance IntermediaryG or Insurance ManagerG must ensure that monies, other than interest, arising from Approved AssetsG or their realisation, sale or disposal are paid into an Insurance Bank AccountG .

          Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]

        • COB 7.12.9A

          (1) An Insurance IntermediaryG or Insurance ManagerG must not hold Insurance MoniesG for a ClientG in an Insurance Bank AccountG with an Eligible BankG outside the StateG , unless it has previously disclosed in writing to the ClientG :
          (a) that the money may be held in an Insurance Bank AccountG outside the StateG ;
          (b) that in such circumstances, the legal and regulatory regime applying to the Eligible BankG may be different from that in the StateG ;
          (c) in the event of failure of the Eligible BankG , the money may be treated in a different way to that which would apply if the money were held by a bank in the StateG ;
          (d) if it is the case, that the particular Eligible BankG has not accepted that it has no right of set-off or counterclaim against money held in the Insurance Bank AccountG in respect of any sum owed on any other account of the Authorised FirmG ; and
          (e) that the ClientG may notify the Authorised FirmG if he does not wish the money to be held in an Insurance Bank AccountG outside the StateG or in a particular jurisdiction.
          (2) If a ClientG notifies an Insurance IntermediaryG or Insurance ManagerG in writing that he does not wish the Insurance MoniesG to be held in an Insurance Bank AccountG outside the StateG or in a particular jurisdiction, the Insurance Intermediary or Insurance Manager must ensure that, no later than 20 days after receiving the notice, either:
          (a) the Insurance MoniesG are transferred into an Insurance Bank AccountG with an Eligible BankG in the StateG , or in a jurisdiction to which the ClientG has not objected, as the case may be; or
          (b) if no such alternative arrangement can be made, the Insurance MoniesG are returned to the ClientG .
          Derived from DFSA RM182/2016 (Made 19th June 2016) [VER27/08-16]

        • COB 7.12.10

          An Insurance IntermediaryG or Insurance ManagerG may not hold Insurance MoniesG in Approved AssetsG until it has given written notice to and received written notice from the bank referred to in COB Rule 7.12.8(b) that the bank is not entitled to any charge, encumbrance, lien, right of set-off, compensation or retention against Approved AssetsG held for the Insurance Intermediary'sG or Insurance Manager'sG Insurance Bank AccountG .

          Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]

        • COB 7.12.11

          An Insurance IntermediaryG or Insurance ManagerG may only use Approved AssetsG as security for a loan or overdraft where that loan or overdraft is for a purpose relating to an Insurance Bank AccountG as permitted by COB Rule 7.12.6.

          Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]

        • COB 7.12.12

          Where Insurance MoniesG are held in Approved AssetsG whose rating drops below the minimum stipulated within the definitions, that investment or asset will cease to be an Approved AssetG and the Insurance IntermediaryG or Insurance ManagerG must dispose of the investment or asset as soon as possible and no later than within 30 days of the rating change.

          Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]

        • COB 7.12.13

          An Insurance IntermediaryG or Insurance ManagerG may not use derivatives in the management of Insurance MoniesG except for the prudent management of foreign exchange risks.

          Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]

        • COB 7.12.14

          An Insurance IntermediaryG who has a credit balance for a ClientG who cannot be traced should not take credit for such an amount except where:

          (a) he has taken reasonable steps to trace the ClientG and to inform him that he is entitled to the money;
          (b) at least six years from the date the credit was initially notified to the ClientG ; and
          (c) COB Rule 7.12.5(f) will continue to be satisfied after the withdrawal of such money.
          Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]

        • COB 7.12.15

          An Insurance IntermediaryG must keep records of all sums withdrawn from the Insurance Bank AccountG or realised Approved AssetsG as a result of credit taken under COB Rule 7.12.14 for at least six years from the date of withdrawal or realisation.

          Derived from DFSA RM56/2008 (Made 1st July 2008). [VER14/07-08]