Instructions No. (3) of 2003 for the Licensing and Regulation of Actuaries and Their Amendments

Instructions No. (3) of 2003
Instructions for Licensing and Regulating the Work of Actuaries and Their Amendments* Issued by the Board of Directors of the Insurance Authority Pursuant to the provisions of Paragraph (a) of Article (36) and Paragraph (b) of Article (108) of the Law Regulating Insurance Activities No. (33) of 1999

Article (1):
These Instructions shall be known as the (Instructions for Licensing Actuaries and Regulating Their Work for the Year 2003) and shall come into force from the date of their publication in the Official Gazette.

Article (2):
A- The words and expressions contained in these Instructions and defined in the Law Regulating Insurance Activities No. (33) of 1999 shall have the meanings assigned to them in Article (3) of that Law, unless the context indicates otherwise.
B- For the purposes of these Instructions, the word "Actuary" refers to both natural and legal persons, unless expressly stated otherwise.

Article (3):
A- In implementation of the provisions of Paragraph (a) of Article (36) of the Law, no person shall practice the work of actuaries in the Kingdom, including the valuation of insurance contracts, policies, and related accounts, except after obtaining a license from the Authority in accordance with the bases and conditions specified pursuant to the provisions of these Instructions and the decisions issued thereunder.

• These Instructions were published in the Official Gazette on 2 November 2003 in Issue (4629) on Page (5143). These Instructions were also amended by Instructions No. (4) of 2008 (Amending Instructions for Licensing Actuaries and Regulating Their Work No. (3) of 2003), published in the Official Gazette on 4 January 2009 in Issue (4945) on Page (2598); Instructions No. (10) of 2010 (Amending Instructions for Licensing Actuaries and Regulating Their Work), published in the Official Gazette on 2 May 2010 in Issue (5028) on Page (2515); and Instructions No. (2) of 2015 (Amending Instructions for Licensing Actuaries and Regulating Their Work), published in the Official Gazette on 18 October 2015 in Issue (5363) on Page (8364).
  After the cancellation of the Insurance Authority by the Law on Restructuring Government Institutions and Departments No. (17) of 2014, all powers of the Board of Directors of the Insurance Authority were transferred to His Excellency the Minister of Industry, Commerce and Supply, and all powers of the Director General of the Insurance Authority were transferred to His Excellency the Secretary General of the Ministry of Industry, Commerce and Supply.

B- In case of violation of the provisions of Paragraph (a) of this Article, the provisions of Article (88) of the Law shall apply.
C- A company shall not accept any of the actuarial works specified in Paragraph (a) of this Article from any person unless that person holds a license from the Authority to practice actuarial work in accordance with the provisions of these Instructions and the decisions issued thereunder, under penalty of legal liability.

Article (4):
The following conditions must be met by the license applicant:
A- The applicant must hold any of the following:

1. A Fellowship degree or its equivalent by passing the examinations designated for this degree from any of the specialized bodies in actuarial sciences accredited by the Council in accordance with the provisions of Article (5) of these Instructions.
2. An Associateship degree or its equivalent by passing the examinations designated for this degree from any of the specialized bodies in actuarial sciences accredited by the Council in accordance with the provisions of Article (5) of these Instructions, and having practical experience in actuarial work of no less than five years under the supervision of an actuary holding a Fellowship degree, with the experience to be calculated after obtaining the Associateship degree.
   B- The applicant must not have previously had their license and/or registration for practicing actuarial work suspended or cancelled as a disciplinary penalty, or must meet the conditions for re-licensing or re-registration from the body that suspended or cancelled their license. C- The applicant must meet the conditions stipulated in Article (31) of the Law. D- If the applicant is a resident of the Kingdom, they must be dedicated to working in their own office where all records and documents used in their work are kept. Their office may be located within the company if they are employed by it.*

Article (5):
For the purposes of Article (4) of these Instructions, the following bodies shall be the specialized bodies in actuarial sciences accredited by the Council:
A- The Institute of Actuaries in London.
B- The Faculty of Actuaries in Scotland.
C- The Society of Actuaries in the United States of America.
D- The Canadian Institute of Actuaries.
E- Any other comparable body accredited by the Council upon the proposal of the Director General.

Article (6):
The license application shall be submitted according to the form prepared for this purpose, including the data and attached with the following documentary evidence:
A- The name, nationality, and address of the applicant.
B- Two personal photographs.
C- The type of insurance for which the actuarial work is to be practiced.
D- A written statement confirming the fulfillment of the conditions stipulated in Paragraphs (b) and (c) of Article (4) of these Instructions, and undertaking to inform the Authority if these conditions are not met during the year, according to the form prepared for this purpose. E- A copy of the passport or national ID card. F- A certified copy of the Fellowship or Associateship degree, as applicable, from any of the specialized bodies in actuarial sciences accredited by the Council in accordance with the provisions of Article (5) of these Instructions, accompanied by a transcript of grades. G- A certified copy of other academic qualifications. H- A certified copy of practical experience certificates and a recommendation from a Fellow Actuary if the applicant holds an Associateship degree. I- Proof of completion of establishment and registration procedures with the competent authorities in the Kingdom, if the applicant is a resident of the Kingdom, as applicable. J- Proof of payment of the prescribed fees and allowances in accordance with the systems and instructions issued for this purpose pursuant to the Law. K- Any other data or documentary evidence requested by the Director General.

Article (7):
A- The license application for a legal person to practice actuarial work in the Kingdom shall be submitted according to the form prepared for this purpose, including the following:

1. Proof of the fulfillment of the conditions stipulated in Article (4) of these Instructions by providing all the data and documentary evidence stipulated in Article (6) of these Instructions for the General Manager or one of those in charge of its management, as applicable, and for all those performing actuarial work for it, or by providing an undertaking to fulfill all these conditions before the license is granted, as applicable.
2. A detailed statement including the qualifications and experience of its administrative, financial, and technical managers.
3. A signed copy of the company contract or establishment contract and the articles of association, as applicable.
   B- If the legal person to be licensed is a branch of a foreign legal person, in addition to the documents mentioned in Paragraph (a) of this Article, a certified copy of the license of the foreign legal person issued by the home country must be submitted.

Article (8):
A- The Director General shall notify the applicant of either the completion of the application with all data and documentary evidence submitted in accordance with the provisions of Articles (6) and (7) of these Instructions, or the existence of deficiencies, within two weeks from the date of submission of the application. B- In case of deficiencies, the applicant must complete these deficiencies within a period not exceeding thirty days from the date of notification; otherwise, the application shall be considered cancelled, and the applicant shall not submit another application before three months have passed from the date of cancellation of the application.

Article (9):
A- The application for a license submitted in accordance with the provisions of Articles (6) and (7) of these Instructions shall be decided upon by a decision of the Director General within a period not exceeding thirty days from the date of notifying the applicant of the completion of their application with all data and documentary evidence. B- In case of approval of the application stipulated in Paragraph (a) of this Article, the Director General shall notify the applicant thereof in accordance with the provisions of the Law, and the actuary shall be registered in the special register prepared for this purpose with the Authority after providing proof of payment of the prescribed fees and allowances in accordance with the systems and instructions issued for this purpose pursuant to the provisions of the Law.

Article (10):
A- The actuary is obliged to notify the Director General of any changes to any of the data and information under which they were licensed immediately upon occurrence, provided that such changes are consistent with the provisions of these Instructions.
B- The legal person actuary must inform the Director General of the vacancy of the position of its General Manager or any of those in charge of its management in the Kingdom, as applicable, and must fill the vacant position within sixty days from the date of vacancy and notify the Director General thereof. The legal person actuary must also notify the Director General of the vacancy of the position of any of those performing actuarial work for it in the Kingdom.

Article (11):
A- The actuary must submit an application to renew their license annually, no later than forty-five days before the expiration of the license period, which falls on the 31st of December of each year, according to the form prepared for this purpose, accompanied by the following:

1. A statement including the actuarial work practiced in the Kingdom during the year.
2. Proof of continued membership in any of the specialized bodies in actuarial sciences accredited by the Council in accordance with the provisions of Article (5) of these Instructions.
3. Proof of participation in specialized courses in actuarial sciences or participation in conferences or seminars in actuarial sciences of no less than fifteen hours, unless the Director General decides otherwise.
4. A written statement in accordance with the provisions of Paragraph (d) of Article (6) of these Instructions.
5. Proof of payment of the prescribed fees and allowances in accordance with the systems and instructions issued for this purpose pursuant to the provisions of the Law.
   B- The legal person actuary must submit, in addition to what is stipulated in Paragraph (a) of this Article, a statement including the name of its General Manager or those in charge of its management, as applicable, and all those performing actuarial work for it in the Kingdom. C- The application for license renewal stipulated in Paragraph (a) of this Article shall be decided upon in accordance with the provisions of Article (9) of these Instructions, as applicable.

Article (12):
An actuary wishing to suspend their license may submit an application to the Authority for this purpose, and may submit an application for re-registration in the special register prepared for this purpose, provided that they submit a written application according to the form prepared for this purpose, subject to the following provisions:
A- If the suspension period does not exceed one year from the date of the application, the provisions of Article (11) of these Instructions shall apply, as applicable.
B- If the suspension period exceeds one year from the date of the application, the actuary must, in addition to what is stipulated in Paragraph (a) of this Article, provide proof of participation in specialized courses in actuarial sciences or participation in conferences or seminars in actuarial sciences of no less than fifteen hours during the two years preceding the application. C- If the suspension period exceeds five years from the date of the application, the actuary must submit a new license application in accordance with the provisions of these Instructions.

Article (13):
It is not required for a natural person actuary to be a resident of the Kingdom or to have a principal place of work there.

Article (14):
A- 1- The actuary provides their services to the company either as an employee or as an approved actuary, and in both cases, the company must inform the Director General thereof within one month from the date of appointment or approval.
2- It is prohibited for an actuary appointed by a company to hold another position in it or to provide services to another company.
3- The actuary is appointed or approved by the company's board of directors based on the proposal of the audit committee formed within the company, and this must be done before the end of the financial year. The name of the actuary shall be included in the company license renewal form. The company's board of directors shall not dismiss or terminate the actuary during the period between the end of the financial year and the completion of procedures for granting non-objection to the publication of final statements, unless justified reasons exist approved by the Secretary General based on the proposal of the concerned directorate. B- The company must provide the actuary appointed or approved by it with any data, documents, information, records, or files for the purposes of performing the tasks and responsibilities assigned to them. C- In case any of the reports required pursuant to the provisions of the Law, systems, and instructions issued thereunder are submitted by a legal person actuary, it is required that those reports be signed in the name of the legal person actuary and that the person signing the report meets all the conditions stipulated in Article (4) of these Instructions. D- The company must include a summary of the actuary's opinion contained in the actuary's certificate within the financial statements according to the form prepared in accordance with the provisions of these Instructions and approved by the concerned directorate. E- The company must provide the concerned directorate with a certificate from the expert actuary clarifying the concepts, bases, and assumptions according to which technical bases and premium rates are adopted for each insurance product the company wishes to market and issue.

Article (15):
No member of the company's board of directors, its General Manager, or holders of 10% or more of its shares shall practice actuarial work on its behalf.

Article (16):
The actuary must perform the following tasks and responsibilities:
A- Providing advice and consultation to the company regarding actuarial work requested from them in accordance with accepted actuarial concepts and bases.
B- Performing any of the tasks and responsibilities assigned to them in accordance with accepted actuarial concepts and bases.
C- Informing the company's board of directors of any matter that may constitute a violation of the provisions of the Law, systems, instructions, or decisions issued thereunder related to the financial or technical status of the company, to take the necessary action regarding them, or that may affect the interests of the insured or beneficiaries of insurance policies, if it becomes apparent to them. D- Preparing the reports required by law according to the forms prepared for this purpose. E- Keeping special records of their work organized according to standards, where data and copies of documents that they must provide to the Authority are kept. F- Performing their duties with honesty and integrity, and they must, in the course of their work, refrain from all of the following:

1. Concealing any facts related to the financial or technical status of the company from its board of directors or the Authority.
2. Providing false information related to the financial or technical status of the company.
3. Engaging in incorrect actuarial practices.
4. Disclosing to others confidential information about the company obtained through their work, subject to the provisions of Article (17) of these Instructions.
5. Entrusting another person to perform the company's actuarial work on their behalf.

Article (17):
The actuary must submit an immediate report to the Director General and a copy to the chairman of the company's board of directors in any of the following cases:
A- If it becomes apparent to them that the company has violated the provisions of the Law, systems, instructions, or decisions issued thereunder related to the financial or technical status of the company.
B- If it becomes apparent to them that the financial or technical status of the company prevents it from fulfilling its obligations towards the insured or beneficiaries of insurance policies issued by the company.
C- If the company does not allow them to perform the tasks and responsibilities assigned to them.
D- If they refuse or object to preparing any of the reports required pursuant to the provisions of the Law, systems, instructions, and decisions issued thereunder.
E- If they resign from the company, are dismissed by it, or their approval is cancelled by it.

Article (18):
A- Subject to the provisions of Item (3) of Paragraph (a) of Article (14) of these Instructions, the actuary's work with the company ends in any of the following cases:

1. Their resignation from the company or dismissal by it.
2. Cancellation of their approval by the company.
3. Cancellation of their license by the Authority.
   B- The company must inform the Director General upon the end of the actuary's work with it in any of the cases stipulated in Items (1) and (2) of Paragraph (a) of this Article, and the company must appoint or approve another actuary within a period not exceeding one month from the date of the end of the services of the actuary whose services ended, and provide them with the report stipulated in Article (17) of these Instructions. C- The company must notify the Authority in accordance with the Law in case of cancellation of the actuary's license.

Article (19):
A- If the Director General has sufficient information indicating any of the following:

1. That the actuary violated the provisions of the Law, systems, instructions, or decisions issued thereunder.
2. That the actuary violated the rules of professional practice and ethics issued pursuant to the provisions of the Law, instructions, and decisions issued thereunder.
3. That the actuary did not perform any of the tasks and responsibilities assigned to them.
4. That the actuary lost any of the conditions under which they were licensed, or if it becomes apparent that any of the data or documentary evidence submitted by them was incorrect.
5. That the actuary did not renew their license in accordance with the provisions of Article (11) of these Instructions and continues to practice their work.
6. That any of the actuary's reports or estimates regarding the company do not reflect the truth of its financial assets.
   B- The Director General may take any of the following actions if it becomes apparent to them that any of the information stipulated in Paragraph (a) of this Article is true:
7. Request the actuary to take specific measures to rectify their status within the period specified for that purpose.
8. Request the actuary to resubmit the reports required from them in accordance with the provisions of Paragraph (d) of Article (16) of these Instructions.
9. Suspend the actuary's license and request them to take specific measures to rectify their status within the period specified by the Director General for that purpose.
10. Suspend the actuary's license and refer the matter to the Council to cancel the license.
    C- If the actuary does not rectify their status in accordance with the provisions of Item (1) of Paragraph (b) of this Article, the Director General shall suspend their license and refer the matter to the Council to cancel the actuary's license.
    D- If the actuary removes the causes of license suspension in accordance with the provisions of Item (2) of Paragraph (b) of this Article, the Director General shall issue a decision approving the continuation of the actuary's practice of their work; otherwise, the Director General shall refer the matter to the Council to issue a decision to cancel the license. E- If the Council issues a decision to cancel the actuary's license, the actuary shall not submit a new license application to practice actuarial work in the Kingdom before three years have passed from the date of the cancellation decision if the cause of cancellation is a serious defect, as determined by the Director General.

Article (20):
The Director General may delegate any senior employee in the Authority the powers stipulated in these Instructions, provided that the delegation is written and specific.

Article (21):
Every person registered with the Authority before the enforcement of the provisions of these Instructions to practice actuarial work in the Kingdom is obliged to regularize their status in accordance with their provisions, including renewing their license with the Authority for the year 2004; otherwise, their registration shall be considered automatically cancelled, as applicable, and they are prohibited from continuing to practice their work, under penalty of legal liability.

Article (22):
Decision No. (3) of 1987 issued on 1987/9/20 (Instructions for Registering Life Insurance Experts) and Decision No. (7) of 1988 issued on 1988/9/24 (Instructions for Regulating the Report of Life Insurance Specialists) and the forms attached to them are repealed.

Article (23):
The Director General shall issue the necessary decisions to implement the provisions of these Instructions.

Board of Directors of the Insurance Authority