Parliament has introduced a comprehensive bill that imposes severe penalties for providing false information in insurance claims and for operating without a licence. The bill was presented by Mahibadhoo MP Ahmed Thariq (PNC) on behalf of the government, with the aim of establishing robust business regulations and ensuring compliance within the industry.
The proposed legislation targets individuals and entities that intentionally provide false information, either directly or indirectly, to gain an unfair advantage in insurance claims. It also encompasses those attempting to secure such an advantage or aiding others in doing so. Under the new bill, the Maldives Monetary Authority (MMA) is empowered to impose fines ranging from MVR 100,000 to MVR 5 million, based on the severity of the offence.
Additionally, the bill mandates that all insurance businesses in the Maldives must be licensed by the MMA. Failure to obtain a proper licence could result in substantial fines, with penalties ranging from USD 6,510 to USD 325,534. This measure is designed to uphold the quality and integrity of the Maldivian insurance sector, ensuring that all businesses operate within the legal framework.
The legislation categorises insurance businesses into two main types: general insurance and long-term insurance. General insurance includes general takaful business, while long-term insurance encompasses family takaful business. This categorisation aims to provide clarity and ensure that all aspects of the insurance sector are adequately regulated.
The bill’s objectives are multifaceted, focusing on protecting the rights of policyholders, fostering sector development, and expanding competition within the industry. By establishing stringent rules, the government seeks to ensure that insurance services meet the needs of the public and contribute to the economic development of the Maldives.
In addition to combating fraud, the bill outlines measures to be taken against any insurance company or affiliate found in violation of the law. These measures are intended to maintain high standards within the sector and prevent any detrimental practices that could undermine public trust.
The introduction of this bill marks a proactive step towards enhancing the regulatory framework of the Maldivian insurance industry. By imposing substantial fines and enforcing strict licencing requirements, the government aims to create a secure and transparent environment for both insurers and policyholders.
