CBUAE Insurance Sector Anti Money Laundering Guidance

CBUAE Insurance Sector Anti-Money Laundering (AML) Guidance applies to the Licensed Financial Institutions (LFIs) in the insurance sector comprising insurance and reinsurance companies, agents, and brokers.

The Central Bank guidance comes into effect immediately and it will assist insurance companies to understand their statutory AML/CFT obligations considering the Financial Action Task Force (FATF) standards.

CBUAE guidance for the insurance sector requires insurance and reinsurance companies, agents, and brokers to demonstrate compliance with its requirements within one month.

The guidance focuses on the ML/TF risks relevant to life insurance and other investment-related insurance products and how insurance operators can apply preventive measures to identify, assess, manage, and mitigate them.

It also requires insurance companies to perform, document, and keep up to date an enterprise risk assessment. It requires them to perform customer due diligence, understand the nature of the customer’s business and the nature and purpose of the operator’s relationship with the customer, including the expected uses to which the customer will put the operator’s products or services, and subject all customers to ongoing monitoring throughout the business relationship.

Moreover, the operators must apply enhanced due diligence (EDD) measures if they identify a customer or relationship presenting higher ML/TF risks.

Insurance companies are also required to maintain transaction monitoring systems to identify unusual and potentially suspicious transactions and report such transactions to FIU’s goAML portal in the form of filing SAR (Suspicious Activity Report) or STR (Suspicious Transaction Report).