Insurance Authority to adopt Risk-Based Capital framework

The Saudi Insurance Authority (IA) has introduced a regulatory framework for Risk-Based Capital (RBC). Effective 1 January 2027, insurers and reinsurers will be required to comply with this new prudential regime.

To support a smooth transition, an initial implementation phase will commence in 2026. During this period, insurers and reinsurers will be required to assess their solvency under both the RBC framework and the existing regime.

The new framework is broadly aligned with the European Solvency II model, while being tailored to reflect the specific characteristics of the Saudi market.

Through this initiative, the IA seeks to enhance the resilience and stability of the local insurance sector.