Speaking to International Adviser after Dubai’s Insurance Authority announced game-changing plans to ban indemnity commissions, Johnston said: “We’re looking at what’s going on in the UK, Australia and elsewhere, but we haven’t seen any need to take that step here yet.”
Johnston said the guiding light for the regulator were the requirements set by global bodies.
“We make sure our regime for banks meets the Basel III rules and our requirements around securities and funds management and distribution meet the International Organisation of Securities Commissions rules.
“The same is true for insurance and the International Association of Insurance Supervisors. That’s where we take our lead from.”
Johnston said member companies in the Dubai International Financial Centre were largely operating in a non-retail market.
As for disclosure of commission and fees, he said the DFSA already has rules in place. “We require high levels of disclosure if you’re dealing with a client and providing advice.”
Insurance Authority regulation update
Meanwhile, the UAE Insurance Authority (IA) is not expected to release its final plans for the implementation of the proposed indemnity commission ban on offshore bond sales until early 2017 while it considers a joint submission from the region’s main international life companies.
The life companies banded together with the help of local law firm Clyde & Co to present the regulator with the industry’s views on modifying and implementing the proposed reforms, which is likely to have included a request for a 12-month grace period for implementation of any changes.
No response is expected from the IA until at least the end of January, sources in Dubai told International Adviser.
