• Population
  9.086^m
• AL Rank (GDP)
  2nd
• Global Rank (GDP)
  30th

GDP 2014
$401.6 billion

• Economic Growth 2012
  4.7%
• Economic Growth 2013
  5.2%
• Economic Growth 2014
  3.6%

• Inflation (official) 2012
  2.4%
• Inflation (official) 2013
  2.7%
• Inflation (official) 2014
  -3.6%

• Currency/Exchange Ratewww.bloomberg.com/markets/currencies

• RESERVATION OF RIGHTS/WITHOUT PREJUDICE RULEThe doctrines of reservation of rights or without prejudice correspondence do not exist under UAE law in the form or usage that they are used in England. Under the Insurance Authority's Code of Conduct for Insurers, insurers are required to inform the insured/beneficiary whether the claim is accepted or rejected within 15 days from the date of receipt of full documentation. The parties can enter into non-disclosure or confidentiality agreements whereby information passed between them cannot be shown to third parties, although there must be a clear agreement to this effect and on the meaning of without prejudice correspondence, including a clear statement that the communication is not an admission of liability.
• PrivilegeUnder UAE law, there is no general doctrine of privilege (whether legal advice privilege or litigation privilege), although the impact of this is minimised by the absence of any obligation of disclosure (discussed below). However, the laws governing lawyers' conduct in the UAE prohibit lawyers from disclosing confidential information provided by their clients without the client's consent or other limited circumstances.
• DisclosureThere is no formal doctrine of disclosure under UAE law, nor any general obligation on parties to litigation to disclose documents as that which applies under English law. However, pursuant to the laws governing evidence, a party may request the court to order disclosure of a limited class of documents in specified circumstances. A court appointed expert also has the power to require parties to disclose documents in limited specified circumstances.
• InterestUAE courts generally award interest at a rate of 9% from the date of judgement, although in some cases, pre-judgement interest may also be awarded.
• CostsThe general principle is that the losing party will be ordered to pay the costs of the litigation. However, in general, only nominal legal fees and costs (including court fees) are required to be paid by the losing party.
• Monetary CorrectionIn the absence of an express contractual provision, monetary correction is not provided for under UAE law.
• Punitive DamagesUAE law does not expressly provide for punitive damages.
• Expected length of caseOn average, proceedings in the Court of First Instance will take 18 months, although more complex matters can take considerably longer than this. Appeals to the Appeal Court, and subsequently the Court of Cassation, are likely to take from one to five years, depending upon the complexity of the case and the court. Court of Appeal proceedings often result in a rehearing of facts and evidence, while appeals to the Court of Cassation are on points of law only.

• Fronting RequirementsAt present, there are no express legal provisions restricting fronting transactions in the UAE. Therefore, as long as the insurer is in compliance with applicable prudential limitations in local regulations, there is no provision preventing it from ceding 100% of a given written risk, either to a local reinsurer or a foreign reinsurer. In practice, local insurers are heavily reliant on foreign reinsurers or reinsurers established in the Dubai International Financial Centre.
  
  While there are no express legal provisions under UAE law, in practice, the Insurance Authority will generally require insurance policies issued in the UAE to be governed by UAE law. In the case of reinsurance policies, the parties are free to choose the law applicable to the contract. The parties can also choose arbitration as the method of dispute resolution. However in relation to insurance contracts, strictly speaking, the arbitration clause must be set out in a separate agreement agreed to by both parties.
• LimitationUnder the UAE Civil Code, claims arising out of a non-marine insurance contract must be brought within three years from the date of the event out of which the claim arose or the date the insured has knowledge of such event. In relation to contracts of marine insurance, claims must be brought within two years, although the date from which the limitation period runs depends on the nature of the claim. Reinsurance contracts are likely to fall within these limitation periods if the reinsurance contract is governed by UAE law.
• Conditions, Conditions Precedent and WarrantiesUAE law does not expressly define "conditions", "conditions precedent" and "warranties" as such. However, there are certain formalities and other provisions regarding the interpretation of such clauses in an insurance contract of which the re/insurer should be aware.
  
  To be valid and enforceable under UAE law, conditions precedent to liability, warranties or exclusion clauses must be: (a) “prominent”, such as in bold font and a different colour; and (b) endorsed by the assured. Under the UAE Civil Code:
  1. Any clause in an insurance contract that seeks to entitle the insurer to avoid the contract of insurance/avoid the claim in relation to a breach which is not causative of the loss is potentially invalid. This definition covers warranties, exclusion clauses and conditions precedent.
  2. In relation to notification clauses (drafted as conditions precedent), late notification or failure to provide documents cannot inflict “forfeiture on the assured”, if the delay is due to an “acceptable excuse”.
• Non-Disclosure/MisrepresentationThe UAE Civil Code imposes an obligation on the insured to disclose all facts which are material to the insurer's assessment of the risk being assumed. This duty applies at the time the insurance is procured and also on an ongoing basis during the period of the policy. The insurer may cancel the policy if the insured "acting in bad faith conceals any matter or provides incorrect information such as to lessen the degree of the risk insured against, or to vary the subject matter thereof, or if he fraudulently fails to discharge any obligation he has undertaken". The insurer may retain any premiums paid where the non-disclosure or misrepresentation can be shown to be fraudulent or in bad faith. The burden of proving fraud or bad faith is on the insurer who must produce clear documentary evidence.
• FOLLOW THE FORTUNES/SETTLEMENTSUAE law does not regulate or define the concepts of “follow the fortunes” or "follow the settlements" clauses. Therefore, it is necessary to rely on the reinsurance contract wording itself to determine the obligations of the parties and the consequences of any breach thereof. It is therefore very important for the parties to include very clear “follow the fortunes” or "follow the settlements" wording which explains the intention of the parties and the consequences of a settlement of a claim by the cedant.
• CLAIMS CO-OPERATION/CLAIMS CONTROLThere are no provisions in UAE law regarding claims cooperation or control. Therefore, the scope of the claims cooperation/control and the consequences of a breach of such a provision will need to be clearly provided for in the wording of the reinsurance contract.
• ROLE OF THE REINSURANCE BROKER (PRODUCING AND PLACING)There is no legal requirement under UAE law to conduct insurance/reinsurance business through an insurance broker. Where an insurance broker is involved, insurance brokers in the UAE must be authorised by the UAE Insurance Authority. Under UAE law, a broker is an independent intermediary who mediates insurance or reinsurance contracts between the insured/reinsured and the insurer/reinsurer and is paid a commission from the insurer/reinsurer. UAE law does not distinguish between placing brokers and producing brokers.
  
  UAE insurance law distinguishes between a broker and an agent. The first acts independently as an intermediary; the latter acts directly and exclusively as intermediary for one insurer/reinsurer. Both categories are separate and a broker cannot act as agent and vice versa.
  
  Reinsurance brokers are not directly regulated under UAE law, provided they do not carry on business activities in the UAE (their business activities are conducted outside the UAE). Therefore generally, a reinsurance broker's functions and duties will be determined by the contractual arrangements between it and the reinsured, a producing broker and/or the reinsurer, as the case may be. In relation to reinsurance brokers that are established and authorised in the UAE, they will need to comply with the UAE Insurance Authority's Brokers Regulations. A broker in the UAE is not permitted to act as both insurance broker and reinsurance broker for the same customer and the same transaction.

• Population
  1.362^m
• AL Rank (GDP)
  17th
• Global Rank (GDP)
  97th

GDP 2014
$33,87 billion

• Economic Growth 2012
  3.6%
• Economic Growth 2013
  5.3%
• Economic Growth 2014
  4.5%

• Inflation (official) 2012
  2.2%
• Inflation (official) 2013
  1.5%
• Inflation (official) 2014
  -1.5%

• Currency/Exchange Ratewww.bloomberg.com/markets/currencies

• RESERVATION OF RIGHTS/WITHOUT PREJUDICE RULEThe doctrines of reservation of rights or without prejudice correspondence do not exist under Bahraini law in the form or usage that they are used in England. Under the Bahraini Civil Code, insurers are required to pay the insured amount within 30 days from the date on which the insured submits the necessary information and documents. The parties can enter into non-disclosure or confidentiality agreements whereby information passed between them cannot be shown to third parties, although there must be a clear agreement to this effect and on the meaning of without prejudice correspondence, including a clear statement that the communication is not an admission of liability.
• PrivilegeUnder Bahraini law, there is no general doctrine of privilege, whether legal advice privilege or litigation privilege, although the impact of this is minimised by the absence of any obligation of disclosure (discussed below). However, the laws governing lawyers' conduct in Bahrain prohibit lawyers from disclosing confidential information provided by their clients without the client's consent or other limited circumstances.
• DisclosureThere is no formal doctrine of disclosure under Bahraini law, nor any general obligation on parties to litigation to disclose documents as that which applies under English law. However, pursuant to the laws governing evidence, the court may order disclosure of documents on its own volition or following a request by a party if the documents are identified and productive to the matter.
• InterestBahraini courts generally award interest at a rate of between 4% to 7% from the date of filing the action until final payment.
• CostsThe general principle is that the losing party will be ordered to pay the court fees paid by the other party. However, the losing party can also be ordered to pay nominal legal fees of the other party in some circumstances.
• Monetary CorrectionIn the absence of an express contractual provision, monetary correction is not provided for under Bahraini law.
• Punitive DamagesBahraini law does not expressly provide for punitive damages.
• Expected length of caseGenerally, proceedings in the Court of First Instance will take six to nine months, although more complex matters can take considerably longer than this as this may entail the appointment of experts. In the instance of an appeal, the appealing party has 15, 30, or 60 days to submit an official appeal based on the nature of the case. Cases of a non-priority, non-specialised nature that occur in high frequency, such as motor claims, will stay pending for a few years due to their sheer volume and unimportance. Cases of a more specialised nature, such as banking and insurance claims, are dealt with sooner; however, most of these claims do not reach court-level as the agreements governing the parties of such claims contain arbitration clauses, whereby the parties submit to being mediated by a foreign arbitration chamber. Most insurance companies try to settle any disputes with the client prior to escalation.
  
  Once an appeal is lodged, there is no set time frame in which the courts may adjudicate the case. This is dependent upon the number of pending cases awaiting final judgment. The Bahrain Chamber for Economic, Financial and Investment Dispute Resolution (BCDR) may also have jurisdiction over a matter or claim in the following two instances - if both parties have agreed to submit to such jurisdiction, or if the matter must be referred to the BCDR by law. In relation to the latter, a matter shall be referred to the BCDR if the claim value exceeds BD 500,000 and if the dispute involves a financial institution in Bahrain according to the Central Bank of Bahrain law, or an international commercial dispute. Awards under the BCDR may be challenged directly to the Court of Cassation, which may extend the case duration up to two years.

• Fronting RequirementsAt present, outright fronting is not permitted but is still commonly practiced. We understand that local insurers are heavily reliant on foreign reinsurers and that in practice, according to the CBB rulebook that governs such fronting arrangements, the insurer must “monitor its exposure, to an individual reinsurer and provide details of its reinsurance programme to the CBB. It must notify the CBB if its total aggregate exposure, on a premium basis, to one reinsurer (or group of related reinsurers, exceeds 25% of individual or aggregate risks and why it considers that this exposure does not pose a credit risk for which a provision should be made the risk.”
  
  The parties are free to choose the law applicable to the insurance/reinsurance contract and Bahraini courts will generally uphold a foreign governing law clause provided it does not offend public order, morality or core public policies in Bahrain. The parties can also choose arbitration as the method of dispute resolution, however, under the Bahraini Civil Code, an arbitration clause must be “prominently highlighted" in block letters or larger font and signed by the parties.
• LimitationUnder the Bahraini Civil Code, claims arising out of a general insurance contract must be brought within three years from the occurrence of the incident from which the claim arose with the following exceptions:
  1. In the case of non-disclosure or misrepresentation, the time limit is from the date the insurer becomes aware of the non-disclosure or misrepresentation.
  2. In the case of an insured accident, from the date the concerned persons become aware of the occurrence.
  3. In relation to liability insurance, from the date of filing of the action by the third party against the insured or the date on which the third party receives compensation from the insured.
  In relation to contracts of marine insurance, claims must be brought within two years, although the date from which the limitation period runs depends on the nature of the claim. Reinsurance contracts are likely to fall within these limitation periods if the reinsurance contract is governed by Bahraini law.
• Conditions, Conditions Precedent and WarrantiesBahraini law does not expressly define "conditions", "conditions precedent" and "warranties" as such. However, there are certain formalities and other provisions regarding the interpretation of such clauses in an insurance contract of which the re/insurer should be aware.
  
  To be valid and enforceable under Bahraini law, any "conditions relating to invalidity, forfeiture or arbitration" (which would therefore include conditions precedent to liability, warranties or exclusion clauses) must be “prominently highlighted" in block letters or larger font. Under the Bahraini Civil Code:
  1. Any clause in an insurance contract that seeks to entitle the insurer to avoid the contract of insurance/avoid the claim in relation to a breach which is not causative of the loss is potentially invalid. This definition covers warranties, exclusion clauses and conditions precedent.
  2. In relation to notification clauses "stipulating the forfeiture of the insured's right" (drafted as conditions precedent) in the event of a delay in notifying a claim or providing documents, such provisions will not be valid if there was an "acceptable excuse" for the delay.
• Non-Disclosure/MisrepresentationThe Bahraini Civil Code imposes an obligation on the insured to disclose "all circumstances of which he is aware and which are useful for the insurer to know to enable the latter to assess the risks assumed" and in particular, those matters which the insurer made the subject of specific written questions. For instance, in terms of medical insurance, the insurer may require a detailed medical history and from the requesting party in order to be evaluated adequately. This duty applies at the time the insurance is procured. Further, during the period of the policy, the insured is obliged to notify the insurer of any circumstances which result in increasing the risks insured.
  
  An insurance policy is voidable by the insurer if "the insured remains silent in respect of a certain matter or submits an improper statement that is likely to change the issue of the risk or its significance is undermined in the insurer's opinion". In terms of the insurer's rights:
  1. If the non-disclosure/misrepresentation is discovered before the insured risk materialises, the insurer may avoid the policy after 10 days written notice (by registered post) unless the insured agrees to an increase of the premium reflecting the increased risk. If the policy is avoided, the insurer must refund the premium or that part of the premium in respect of which the insurer did not take a risk.
  2. If the non-disclosure/misrepresentation is discovered after the insured risk materialises, the insured amount is reduced in the same proportion as the premiums actually paid compared to the premiums which should have been paid had the risks been accurately disclosed by the insured. If such a non-disclosure is intentional, it warrants the cancellation of the contract.
  3. Misrepresentation warrants the cancellation of the policy from the beginning. Typically, an insurer chooses to reject a specific claim rather than terminate the full contract if the misrepresentation is not material.
• FOLLOW THE FORTUNES/SETTLEMENTSBahraini law does not regulate or define the concepts of “follow the fortunes” or "follow the settlements" clauses. Therefore, it is necessary to rely on the reinsurance contract wording itself to determine the obligations of the parties and the consequences of any breach thereof. It is common for treaty reinsurance contracts to explicitly contain the aforementioned clauses. Exceptionally, the clauses are read into implicitly. It is therefore very important for the parties to include very clear “follow the fortunes” or "follow the settlements" wording which explains the intention of the parties and the consequences of a settlement of a claim by the cedant.
• CLAIMS CO-OPERATION/CLAIMS CONTROLThere are no provisions under Bahraini law regarding claims cooperation or control. Therefore, the scope of the claims cooperation/control and the consequences of a breach of such a provision will need to be clearly provided for in the wording of the reinsurance contract, and may also be based on the scope of work of the insured company.
• ROLE OF THE REINSURANCE BROKER (PRODUCING AND PLACING)There is no legal requirement under Bahraini law to conduct insurance/reinsurance business through an insurance broker. Where an insurance broker is involved, insurance brokers in Bahrain must be authorised by the financial services regulator, the Central Bank of Bahrain. Under Bahraini law, a broker is an independent intermediary who:
  1. Acts as agent for another person in relation to the buying of insurance for that other person.
  2. Makes arrangements with a view to another person, whether as principal or agent, buying insurance.
  3. Advises on insurance.
  Bahraini law does not distinguish between placing brokers and producing brokers. Reinsurance brokers based in Bahrain shall be registered in accordance with the CBB Rulebook 3 and the CBB law, and must be duly licensed. Foreign Reinsurance brokers are not directly regulated under Bahraini law, provided they do not carry on business activities in Bahrain (such as their business activities are conducted outside Bahrain). Therefore generally, a foreign reinsurance broker's functions and duties will be determined by the contractual arrangements between it and the reinsured, a producing broker and/or the reinsurer, as the case may be.

• Population
  3.753^m
• AL Rank (GDP)
  4th
• Global Rank (GDP)
  56th

GDP 2014
$175.8 billion

• Economic Growth 2012
  6.6%
• Economic Growth 2013
  1.5%
• Economic Growth 2014
  N/A

• Inflation (official) 2012
  7.5%
• Inflation (official) 2013
  0.9%
• Inflation (official) 2014
  N/A

• Currency/Exchange Ratewww.bloomberg.com/markets/currencies

• RESERVATION OF RIGHTS/WITHOUT PREJUDICE RULEThe doctrines of reservation of rights or without prejudice correspondence do not exist under Kuwaiti law in the form or usage that they are used in England. Under the Kuwaiti Civil Code, insurers are required to inform the insured/beneficiary whether the claim is accepted or rejected within 30 days from the date of receipt of full documentation. The parties can enter into non-disclosure or confidentiality agreements whereby information passed between them cannot be shown to third parties, although there must be a clear agreement to this effect and on the meaning of without prejudice correspondence, including a clear statement that the communication is not an admission of liability.
• PrivilegeUnder Kuwaiti law, there is no general doctrine of privilege ( whether legal advice privilege or litigation privilege), although the impact of this is minimised by the absence of any obligation of disclosure (discussed below). However, the laws governing lawyers' conduct in Kuwait prohibit lawyers from disclosing confidential information provided by their clients without the client's consent or other limited circumstances.
• DisclosureThere is no formal doctrine of disclosure under Kuwaiti law, nor any general obligation on parties to litigation to disclose documents as that which applies under English law. However, pursuant to the laws governing evidence, the court may order disclosure of documents on its own volition or following a request by a party if the documents are:
  1. Documents that the parties have in common, for example, a contractual agreement.
  2. Relied upon by the requesting party during the proceedings.
  3. Document to which the requesting party is otherwise entitled to under Kuwaiti law.
• InterestKuwaiti courts generally award interest at a rate determined from time to time by the Central Bank of Kuwait, which is usually the same rate applicable to commercial loans.
• CostsThe general principle is that the losing party will be ordered to pay the costs of the litigation. However, in general, only nominal advocacy fees and costs (including court fees) are required to be paid by the losing party. "Legal fees" in the western sense are not recoverable.
• Monetary CorrectionIn the absence of an express contractual provision, monetary correction is not provided for under Kuwaiti law.
• Punitive DamagesKuwaiti law does not expressly provide for punitive damages.
• Expected length of caseGenerally, proceedings in the Court of First Instance will take between 18 months to two years, although more complex matters can take considerably longer than this since most matters are referred to a court expert.
  
  Proceedings in the Court of Cassation has no timeline. Proceedings in the Court of Appeal will take four to six months (if there is no expert) or 12 – 18 months (if there is an expert).

• Fronting RequirementsAt present, there are no legal provisions restricting fronting transactions in Kuwait. Therefore, as long as the insurer is in compliance with applicable prudential limitations in local regulations, there is no provision preventing it from ceding 100% of a given written risk, either to a local reinsurer or a foreign reinsurer. In practice, local insurers are heavily reliant on foreign reinsurers.
  
  The parties are free to choose the law applicable to the insurance/reinsurance contract and Kuwaiti courts will generally uphold a foreign governing law clause provided it does not violate Kuwaiti public policy. The parties can also choose arbitration as the method of dispute resolution, however, under the Kuwaiti Civil Code, an arbitration clause must be “written in a distinctive manner" in block letters or larger font.
• LimitationUnder the Kuwaiti Civil Code, claims arising out of a general insurance contract must be brought within three years from the date of the occurrence giving rise to the claim. In relation to contracts of marine insurance, the Kuwaiti Merchant Shipping Law requires that claims must be brought within two years, although the date from which the limitation period runs depends on the nature of the claim. Reinsurance contracts are likely to fall within these limitation periods if the reinsurance contract is governed by Kuwaiti law.
• Conditions, Conditions Precedent and WarrantiesKuwaiti law does not expressly define "conditions", "conditions precedent" and "warranties" as such. However, there are certain formalities and other provisions regarding the interpretation of such clauses in an insurance contract of which the re/insurer should be aware.
  
  To be valid and enforceable under Kuwaiti law, conditions precedent to liability, warranties or exclusion clauses must be: (a) “written in a distinctive manner” such as in bold or larger font. Under the Kuwaiti Civil Code:
  1. Any clause in an insurance contract that seeks to entitle the insurer to avoid the contract of insurance/avoid the claim in relation to a breach which is not causative of the loss is potentially invalid. This definition covers warranties, exclusion clauses and conditions precedent.
  2. In relation to notification clauses (drafted as conditions precedent), late notification or failure to provide documents cannot result in "expiry of the insured's right"”, if the delay is due to an “acceptable cause”.
• Non-Disclosure/MisrepresentationThe Kuwaiti Civil Code imposes an obligation on the insured to disclose "all circumstances known to him and which the insurer needs to know in order to assess the risks undertaken by him" and in particular, those matters which the insurer made the subject of specific written questions. This duty applies at the time the insurance is entered into and on an ongoing basis during the period of the policy where the insured is obliged to notify the insurer of any circumstances which result in increasing the risks insured.
  
  An insurance policy is voidable by the insurer if the insured "has failed to declare a matter, or has provided an incorrect particular which tends to change the subject of the risks or reduce the significance thereof in the view of the insurer" In terms of the insurer's rights:
  1. If the non-disclosure/misrepresentation is discovered before the insured risk materialises, the insurer may avoid the policy after 10 days' written notice (by registered post) unless the insured agrees to an increase of the premium reflecting the increased risk. If the policy is avoided, the insurer must refund the premium or that part of the premium in respect of which the insurer did not take a risk.
  2. If the non-disclosure/misrepresentation is discovered after the insured risk materialises, the insured amount is reduced in the same proportion as the premiums actually paid compared to the premiums which should have been paid had the risks been accurately disclosed by the insured.
• FOLLOW THE FORTUNES/SETTLEMENTSKuwaiti law does not regulate or define the concepts of “follow the fortunes” or "follow the settlements" clauses. These concepts have never been fully tested in the Kuwaiti courts and there have never been clear laws on these specific concepts. Therefore, it is necessary to rely on the reinsurance contract wording itself to determine the obligations of the parties and the consequences of any breach thereof. As such, it is very important for the parties to include very clear “follow the fortunes” or "follow the settlements" wording which explains the intention of the parties and the consequences of a settlement of a claim by the cedant.
• CLAIMS CO-OPERATION/CLAIMS CONTROLThere are no provisions in Kuwaiti law regarding claims cooperation or control. Therefore, the scope of the claims cooperation/control and the consequences of a breach of such a provision will need to be clearly provided for in the wording of the reinsurance contract.
• ROLE OF THE REINSURANCE BROKER (PRODUCING AND PLACING)There is no legal requirement under Kuwaiti law to conduct insurance/reinsurance business through an insurance broker. Where an insurance broker is involved, insurance brokers in Kuwait must be authorised by the financial services regulator, the Ministry of Commerce and Industry. Under Kuwaiti law, a broker is an independent intermediary who mediates insurance or reinsurance contracts between the insured/reinsured and the insurer/reinsurer. Kuwaiti law does not distinguish between placing brokers and producing brokers.
  
  Kuwaiti insurance law distinguishes between a broker and an "exclusive agent". The first acts independently as an intermediary; the latter acts directly and exclusively as intermediary for one insurer/reinsurer.
  
  Reinsurance brokers are not directly regulated under Kuwaiti law provided they do not carry on business activities in Kuwait (their business activities are conducted outside Kuwait). Therefore generally, a reinsurance broker's functions and duties will be determined by the contractual arrangements between it and the reinsured, a producing broker and/or the reinsurer, as the case may be.

• Population
  4.236^m
• AL Rank (GDP)
  10th
• Global Rank (GDP)
  65th

GDP 2014
$81,80 billion

• Economic Growth 2012
  7.1%
• Economic Growth 2013
  3.9%
• Economic Growth 2014
  N/A

• Inflation (official) 2012
  4.9%
• Inflation (official) 2013
  -1.4%
• Inflation (official) 2014
  N/A

• Currency/Exchange Ratewww.bloomberg.com/markets/currencies

• RESERVATION OF RIGHTS/WITHOUT PREJUDICE RULEThe doctrines of reservation of rights or without prejudice correspondence do not exist under Omani law in the form or usage that they are used in England. Under the Capital Market Authority's Code of Conduct for Insurers, insurers are required to settle claims "promptly". The parties can enter into non-disclosure or confidentiality agreements whereby information passed between them cannot be shown to third parties, although there must be a clear agreement to this effect and on the meaning of without prejudice correspondence, including a clear statement that the communication is not an admission of liability.
• PrivilegeUnder Omani law, there is no general doctrine of privilege (whether legal advice privilege or litigation privilege), although the impact of this is minimised by the absence of any obligation of disclosure (discussed below). However, the laws governing lawyers' conduct in Oman prohibit lawyers from disclosing confidential information provided by their clients without the client's consent or other limited circumstances.
• DisclosureThere is no formal doctrine of disclosure under Omani law, nor any general obligation on parties to litigation to disclose documents as that which applies under English law. However, pursuant to the laws governing evidence, the court may order disclosure of documents where necessary to ascertain the relevant facts.
• InterestOmani courts will award interest at current official interest rates if specifically requested by a party.
• CostsThe general principle is that the losing party will be ordered to pay the costs of the litigation. However, in general, these costs must be reasonable and only nominal legal fees and costs (including court fees) are required to be paid by the losing party.
• Monetary CorrectionIn the absence of an express contractual provision, monetary correction is not provided for under Omani law.
• Punitive DamagesOmani law does not expressly provide for punitive damages.
• Expected length of caseOmani courts are generally seen as being efficient. On average, proceedings in the Supreme Court, followed by appeals to the Court of Appeal and Court of Cassation is likely to take up to three years.

• Fronting RequirementsAt present, there are no legal provisions restricting fronting transactions in Oman, although insurers are required to notify the Capital Markets Authority of their reinsurance arrangements. Therefore, as long as the insurer is in compliance with applicable prudential limitations in local regulations, there is no provision preventing it from ceding 100% of a given written risk, either to a local reinsurer or a foreign reinsurer. In practice, local insurers are heavily reliant on foreign reinsurers.
  
  The parties are free to choose the law applicable to the insurance/reinsurance contract. However, Omani courts have in some cases refused to apply foreign governing law where the application of foreign law would:
  
  a. Contravene an applicable provision of Omani law.
  
  b. Violate Omani public policy or custom.
  
  The parties can also choose arbitration as the method of dispute resolution, however, under the Omani Insurance Law, an arbitration clause must be included in a separate agreement to the general conditions of the policy and signed by both parties.
• LimitationWhilst the Insurance Law does not set out the limitation period for insurance contract claims, the general view is that all insurance contract claims, except motor insurance claims, will be governed by the general limitation period of 10 years set out under the Oman Commercial Code (RD 55/90), unless the insurance contract provides for a shorter limitation period. The Unified Motor Vehicles Insurance Policy Form issued pursuant to a decision issued in February 2016 states that any legal action under the Policy shall be time-barred if not submitted within two years from the date of the accident.
• Conditions, Conditions Precedent and WarrantiesOmani law does not expressly define "conditions", "conditions precedent" and "warranties" as such. However, there are certain formalities and other provisions regarding the interpretation of such clauses in an insurance contract of which the re/insurer should be aware.
  
  To be valid and enforceable under Omani law, conditions precedent to liability, warranties or exclusion clauses must be “printed prominently”. Under the Omani Insurance Law:
  1. Any clause in an insurance contract that seeks to entitle the insurer to avoid the contract of insurance/avoid the claim in relation to a breach which is not causative of the loss is potentially invalid. This definition covers warranties, exclusion clauses and conditions precedent.
  2. In relation to notification clauses (drafted as conditions precedent), late notification or failure to provide documents cannot inflict “forfeiture on the assured”, if the delay is due to an “acceptable reason”.
• Non-Disclosure/MisrepresentationThe Omani Insurance Law imposes an obligation on the insured to disclose "relevant information", however, this obligation is not expressly placed on the insured, but rather is implied by a requirement on the insurer to notify the insured of such an obligation.
  
  A misrepresentation or non-disclosure of a material fact is a breach of an insurance policy and the insurer may refuse payment of the insurance amount (rather than cancellation or avoidance from the beginning of the contract). As the insurance contract will continue to remain valid, there would be no impact on premiums.
• FOLLOW THE FORTUNES/SETTLEMENTSOmani law does not regulate or define the concepts of “follow the fortunes” or "follow the settlements" clauses. Therefore, it is necessary to rely on the reinsurance contract wording itself to determine the obligations of the parties and the consequences of any breach thereof. It is therefore very important for the parties to include very clear “follow the fortunes” or "follow the settlements" wording which explains the intention of the parties and the consequences of a settlement of a claim by the cedant.
• CLAIMS CO-OPERATION/CLAIMS CONTROLThere are no provisions in Omani law regarding claims cooperation or control. Therefore, the scope of the claims cooperation/control and the consequences of a breach of such a provision will need to be clearly provided for in the wording of the reinsurance contract.
• ROLE OF THE REINSURANCE BROKER (PRODUCING AND PLACING)There is no legal requirement under Omani law to conduct insurance/reinsurance business through an insurance broker. Where an insurance broker is involved, insurance brokers in Oman must be authorised by the financial services regulator, the Capital Markets Authority. Under Omani law, a broker is any independent intermediary who intermediates insurance or reinsurance contracts between the insured/reinsured and the insurer/reinsurer and is paid a commission from the insurer/reinsurer. Omani law does not distinguish between placing brokers and producing brokers.
  
  Reinsurance brokers are not directly regulated under Omani law, provided they do not carry on business activities in Oman (their business activities are conducted outside Oman). Therefore generally, a reinsurance broker's functions and duties will be determined by the contractual arrangements between it and the reinsured, a producing broker and/or the reinsurer, as the case may be.

• Population
  2.172^m
• AL Rank (GDP)
  6th
• Global Rank (GDP)
  50th

GDP 2014
$211.8 billion

• Economic Growth 2012
  5.1%
• Economic Growth 2013
  6.2%
• Economic Growth 2014
  6.2%

• Inflation (official) 2012
  6.4%
• Inflation (official) 2013
  0.7%
• Inflation (official) 2014
  -1.8%

• Currency/Exchange Ratewww.bloomberg.com/markets/currencies

• RESERVATION OF RIGHTS/WITHOUT PREJUDICE RULEThe doctrines of reservation of rights or without prejudice correspondence do not exist under Qatari law in the form or usage that they are used in England. Under the Qatari Civil Code, insurers are required to pay the insured’s claim “within thirty days of the day on which the person with the right submits the necessary information and documents to prove his rights”. The parties can enter into non-disclosure or confidentiality agreements whereby information passed between them cannot be shown to third parties, although there must be a clear agreement to this effect and on the meaning of without prejudice correspondence, including a clear statement that the communication is not an admission of liability.
• PrivilegeUnder Qatari law, there is no general doctrine of privilege (i.e. whether legal advice privilege or litigation privilege), although the impact of this is minimized by the absence of any obligation of disclosure (discussed below). However, the laws governing lawyers’ conduct (and the conduct of other professionals such as doctors) in Qatar prohibit lawyers from disclosing confidential information provided by their clients without the client’s consent or other limited circumstances.
• DisclosureThere is no formal doctrine of disclosure under Qatari law, nor any general obligation on parties to litigation to disclose documents as that which applies under English law. However, pursuant to the laws governing evidence, a party may request the court to order disclosure of a limited class of document in specified circumstances. A court appointed expert also has the power to require parties to disclose documents in specified circumstances.
• InterestQatari Courts generally award interest at commercial rates from the date of judgement. In 2013 the Court of Cassation considered an appeal arising from proceedings commenced by a bank for recovery of arrears due under a mortgage together with interest payable under the contract. In its judgement the court held, inter alia, that the appellant bank was entitled to suitable compensation for the damages caused by the delayed payment. However in assessing damages the court did not apply the contractual rate on interest but assessed damages based on general principles under which the court assessing compensation retains full discretion in measuring the appropriate level of damages. In a subsequent court of first instance decision in proceedings for recovery of monies under a facility agreement, together with contractual interest, the claim for interest was re-characterised by the court as a claim for compensation.
• CostsThe general principle is that the losing party will be ordered to pay the costs of the litigation, which will include court fees and lawyer’s costs. The court is not obliged to order the losing party to pay costs; it is at the court’s discretion. However, in general, only nominal legal fees and costs (including Court fees) are required to be paid by the losing party.
• Monetary CorrectionIn the absence of an express contractual provision, monetary correction is not provided for under Qatari law.
• Punitive DamagesQatari law does not provide for punitive damages.
• Expected length of caseOn average, proceedings in the Court of First Instance will take between 1 to 3 years. There is an automatic right to appeal decisions of the Court of First Instance to the Court of Appeal, and subsequently on points of law only, to the Court of Cassation. Appeals are likely to take from 1 to 3 years, depending upon the complexity of case and the Court. Court of Appeal proceedings often result in a rehearing of facts and evidence.

• Fronting RequirementsIn relation to direct insurance, under Article 95 of the Law No 13 of 2012 on the Qatar Central Bank and the Regulation of Financial Institutions, funds or property located within the State of Qatar (or responsibilities arising therefrom) may not be insured from abroad.
  
  At present, there are no legal provisions restricting fronting transactions in Qatar. Therefore, as long as the insurer is in compliance with applicable prudential limitations in local regulations, there is no provision preventing it from ceding 100% of a given written risk, either to a local reinsurer or a foreign reinsurer. In practice, local insurers are heavily reliant on foreign reinsurers or reinsurers established in the Qatar Financial Centre.
  
  Pursuant to the Qatari Civil Code, the parties to a contract are free to choose the law applicable to the insurance/reinsurance contract provided that such terms are not contrary to public policy or morals. In practice, it may be difficult to “prove” a foreign law before the Qatari Courts and the Qatari Courts may apply local law to the contract nevertheless. The parties can also choose arbitration as the method of dispute resolution, however, under the Qatari Civil Code, an arbitration clause must be “in the form of a special agreement separate from the general terms”. Qatar is a signatory to the New York Convention and in a landmark judgement in 2014 the Court of Cassation affirmed the enforceability of an ICC arbitral decision in Qatar.
• LimitationUnder the Qatari Civil Code, claims arising out of a general insurance contract must be brought within 3 years from the date of the occurrence giving rise to the claim. In relation to contracts of marine insurance, the Qatari Maritime Law requires that claims must be brought within 2 years, although the date from which the limitation period runs depends on the nature of the claim. Reinsurance contracts are likely to fall within these limitation periods if the reinsurance contract is governed by Qatari law.
• Conditions, Conditions Precedent and WarrantiesQatari law does not expressly define “conditions”, “conditions precedent” and “warranties” as such. However, there are certain formalities and other provisions regarding the interpretation of such clauses in an insurance contract of which the re/insurer should be aware.
  
  To be valid and enforceable under Qatari law, conditions precedent to liability, warranties or exclusion clauses must be “expressed clearly”. Under the Qatari Civil Code:
  1. Any clause in an insurance contract that seeks to entitle the insurer to avoid the contract of insurance/avoid the claim in relation to a breach which is not causative of the loss is potentially invalid. This definition covers warranties, exclusion clauses and conditions precedent.
  2. In relation to notification clauses (drafted as conditions precedent), late notification or failure to provide documents cannot inflict “forfeiture on the assured”, if the delay is due to an “acceptable excuse”.
• Non-Disclosure/MisrepresentationThe Qatari Civil Code imposes an obligation on the insured to disclose “all the circumstances known to him that are of concern to the insurer to know to enable him to assess the risks he is taking upon himself”. This duty applies at the time the insurance is procured and on an ongoing basis during the period of the policy where the insured is obliged to notify the insurer of any circumstances which result in increasing the risks insured.
  
  An insurance policy is voidable by the insurer if the insured “remained silent about a matter, or presented incorrect information such that the object of the risk is changed or its seriousness reduced, or the probability of its occurrence in the view of the insurer is reduced.” In terms of the insurer’s rights:
  1. If the non-disclosure/misrepresentation is discovered before the insured risk occurs, the insurer may avoid the policy after 10 days’ written notice (by registered post with notice of receipt) unless the insured agrees to an increase of the premium reflecting the increased risk. If the policy is avoided, the insurer must refund the premium or that part of the premium in respect of which the insurer did not take a risk.
  2. If the non-disclosure/misrepresentation is discovered after the insured risk occurs, the insured amount is reduced in the same proportion as the premiums actually paid compared to the premiums which should have been paid had the risks been accurately disclosed by the insured.
• FOLLOW THE FORTUNES/SETTLEMENTSQatari law does not regulate or define the concepts of “follow the fortunes” or “follow the settlement” clauses. Therefore, it is necessary to rely on the reinsurance contract wording itself to determine the obligations of the parties and the consequences of any breach thereof. It is therefore very important for the parties to include very clear “follow the fortunes” or “follow the settlement” wording which explains the intention of the parties and the consequences of a settlement of a claim by the cedant.
• CLAIMS CO-OPERATION/CLAIMS CONTROLThere are no provisions in Qatari law regarding claims cooperation or control. Therefore, the scope of the claims cooperation/control and the consequences of a breach of such a provision will need to be clearly provided for in the wording of the reinsurance contract.
• ROLE OF THE REINSURANCE BROKER (PRODUCING AND PLACING)There is no legal requirement under Qatari law to conduct insurance/reinsurance business through an insurance broker. Where an insurance/reinsurance broker is involved, insurance/reinsurance brokers in Qatar (and consultants and loss adjusters) carrying on business in Qatar must be authorised by the financial services regulator, the Qatar Central Bank (QCB). In addition or in the alternative, authorisation by the Qatari Financial Centre may be required. Qatari law does not distinguish between placing brokers and producing brokers. Regulations covering these ancillary insurance/reinsurance professions are currently awaited from the QCB, which has recently comprehensively revised the requirements for carrying on insurance and reinsurance business in its Executive Insurance Instructions Handbook.
  
  Reinsurance brokers are not directly regulated under Qatari law, provided they are not regarded as carrying on insurance business activities in Qatar (i.e. their business activities are conducted outside Qatar). Therefore generally, a reinsurance broker’s functions and duties will be determined by the contractual arrangements between it and the reinsured, a producing broker and/or the reinsurer (as the case may be).

• Population
  30.89^m
• AL Rank (GDP)
  1st
• Global Rank (GDP)
  19th

GDP 2014
$746.2 billion

• Economic Growth 2012
  5.4%
• Economic Growth 2013
  2.7%
• Economic Growth 2014
  3.5%

• Inflation (official) 2012
  4%
• Inflation (official) 2013
  -1.2%
• Inflation (official) 2014
  -3.1%

• Currency/Exchange Ratewww.bloomberg.com/markets/currencies
• The insurance sector has been historically perceived by Shari'a Scholars in Saudi Arabia to have a strong speculative aspect leading to manifest uncertainty or gharar, something prohibited under Shari'a. Therefore, insurance was not introduced until the late 1990s and only regulated in the early 2000's. In fact, in 1996, a new concept of “cooperative insurance” was introduced into the Saudi market through the establishment of the National Company for Cooperative Insurance (NCCI). This was followed by the issuance in 2003 of the Regulation on the Supervision of Cooperative Insurance Companies issued by Royal Decree M/5 dated 17/5/1405H (the Insurance Law); and soon after was followed by the implementing regulations (the Implementing Regulations).
  
  Although not clearly defined in the Insurance Law, the concept of cooperative insurance is intended to establish a sense of mutual cooperation between the parties to an insurance contract. On one hand, the insurer cooperates by providing coverage, whilst the insured cooperates by paying instalments. In general, the insurance market remains relatively underdeveloped, at least from a regulatory perspective.

• RESERVATION OF RIGHTS/WITHOUT PREJUDICE RULEThere is no all-embracing theory of contract law which applies to all contracts, including in relation to insurance. Generally, contracts are governed by Islamic law or Shari'a and is supplemented by laws, regulations and rules issued by the Saudi government. There are general principles to apply to all contracts, and also some principles which address some contracts in particular the principle of freedom of contract is recognised as a fundamental principle under Shari'a.
  
  In this context, the doctrines of reservation of rights or without prejudice correspondence do not exist under Saudi law in the form or usage that they are used in England. Under the Implementing Regulations, insurers are required to settle claims filed by individuals within 15 days from the date of receipt of all necessary documentation and claims failed by commercial entities within 45 days. There are no restrictions on the parties to enter into non-disclosure or confidentiality agreements whereby information passed between them are not disclosed to third parties; although there must be a clear agreement to this effect and on the meaning of without prejudice correspondence, including a clear statement that the communication is not an admission of liability.
• PrivilegeUnder Saudi law, there is no general doctrine of privilege as recognised in common law jurisdictions ( whether legal advice privilege or litigation privilege). However, the lack of a recognised doctrine is minimised by the absence of any obligation of disclosure (discussed below). Additionally, the laws governing lawyers' conduct in Saudi Arabia clearly prohibit lawyers from disclosing confidential information obtained in the course of their work, whether from clients or from others, without the prior client's consent or within other limited circumstances.
• DisclosureThere is no formal doctrine of disclosure under Saudi law, nor any general obligation on parties to litigation to disclose information or documents as that which applies under English law. However, pursuant to the laws governing evidence, the court may order disclosure of documents in specified circumstances, however such documents must be specifically identified by the party requesting disclosure and proved to exist.
• InterestUnder Saudi law which is based on Islamic Shari’a principles, it is prohibited to pay interest or a sum in the nature of interest, howsoever described. It follows that an obligation to pay interest is not enforceable in Saudi Arabia and will therefore not be ordered by a court.
• CostsSaudi courts do not generally order the losing party to pay the costs of the winning party, unless there is a prior express agreement in this respect between the parties. We note that based on the Rules and Regulations for the Operation of the Committees for the Resolution of Insurance Disputes and Violations, the Insurance Dispute Resolution Committees may rule for the recoverability of legal and other costs incurred by the claimant upon a request made within the same claim or in a separate one.
• Monetary CorrectionIn the absence of an express contractual provision, monetary correction is not provided for under Saudi law.
• Punitive DamagesPunitive damages are not available under Saudi law.
• Expected length of caseThe Rules and Regulations governing the Operation of the Committees for the Resolution of Insurance Disputes and Violations has recently been issued and do not set forth specific timelines for the review of claims filed before the committees. The only timeline specified in the new law relates to the period for appealing decisions issued by the preliminary committee, which is set at 30 days.
  
  Although Insurance Dispute Resolution Committees tend to expedite the claim review process and the eventual issuance of the decisions, it is difficult to anticipate the timeline needed for the proceedings up to the issuance of a final decision.

• Fronting RequirementsThere are numerous restrictions on reinsurance arrangements with non-Saudi reinsurers set out in the Implementing Regulations. Effectively, the Implementing Regulations restricts a Saudi insurance company to ceding only 40% of its total premiums to a non-Saudi reinsurer by requiring Saudi insurers to:
  1. Retain at least 30% of its total insurance premium.
  2. Reinsure 30% of its total premium in Saudi Arabia.
  Additionally, all re-insurance arrangements must first be approved by the insurance services regulator, the Saudi Arabian Monetary Agency (SAMA); the latter's approval will also be required in the event an insured seeks a greater cession to a non-Saudi reinsurer.
  
  In practice, the SAMA will generally require insurance policies issued in Saudi to be governed by Saudi law. In the case of reinsurance policies:
  1. If the reinsurance policy is issued by a Saudi reinsurer, it is likely that the Saudi Arabian Monetary Agency will also require such reinsurance policies to be governed by Saudi law.
  2. If the reinsurance policy is issued by a non-Saudi reinsurer, the parties are free to choose the law applicable to the contract, typically this will be English or US law.
• LimitationThe general rule under Shari'a is that "just rights never die" and therefore, Saudi courts have historically not refused to hear a claim on the basis that it was brought outside a certain time period.
  
  However, under the new Rules and Regulations for the Operation of the Committees for the Resolution of Insurance Disputes and Violations, insurance related disputes are required to be referred to the Insurance Dispute Resolution Committee within five years from the date the amount claimed becomes due.
  
  Given that the Rules and Regulations for the Operation of the Committees for the Resolution of Insurance Disputes and Violations have been newly issued, it is still unclear how the disputes resolution committees will align the limitations set forth in the law with applicable Shari'a principles.
• Conditions, Conditions Precedent and WarrantiesGiven the absence of a contract law in Saudi Arabia, terms like "conditions", "conditions precedent" and "warranties" are not expressly defined.
  
  Additionally, there is little by way of detail in relation to the terms of insurance contracts set out under Saudi law and in general, the terms and conditions of the insurance contract will govern the relationship between the insurer and the insured. This goes in line with the principle of "freedom of contract" which is recognised under Shari'a and where the parties to a contract are free to choosing the terms and conditions of their contracts.
  
  For example, the Implementing Regulations provides that an insurer "shall not cancel a valid insurance policy except for conditions stated in the policy cancellation clause". Therefore, it is important for insurers/reinsurers to ensure that the policy wording is clearly drafted and expressly sets out all of the parties' rights and obligations.
  
  We note that SAMA has issued a number of unified insurance policies where rights and obligations of the insurers and insured are defined. The unified insurance policies are mandatory.
• Non-Disclosure/MisrepresentationSAMA's Insurance Market Code of Conduct Regulation indirectly refers to an obligation on the insured to make "full and honest disclosure of all relevant information needed to determine the insurance needs and underwrite the risk". However, this disclosure obligation imposed on the insured was addressed in the context of the insurer's obligation to inform the insured prior to entering into the contract, of the obligation to disclose necessary information.
  
  Saudi law does not expressly provide remedies for misrepresentation or non-disclosure and in the absence of a contract law, the insurance contract will govern the relationship between the parties. Therefore, it will be important for the insurer/reinsurer to clearly set out in the insurance policy provisions addressing:
  
  a.The obligation of the insured to disclose material information and to not misrepresent facts.
  
  b.The consequences of misrepresentation and/or non-disclosure.
• FOLLOW THE FORTUNES/SETTLEMENTSSaudi law does not regulate or define the concepts of “follow the fortunes” or "follow the settlement" clauses. It is therefore very important for the parties to include in the reinsurance contracts very clear “follow the fortunes” or "follow the settlement" wording which explains the intention of the parties and the consequences of a settlement of a claim by the cedant.
• CLAIMS CO-OPERATION/CLAIMS CONTROLThere are no provisions in Saudi law regarding claims cooperation or control. Therefore, the scope of the claims cooperation/control and the consequences of a breach of such a provision will need to be clearly provided for in the wording of the reinsurance contract.
• ROLE OF THE REINSURANCE BROKER (PRODUCING AND PLACING)There is no legal requirement under Saudi law to conduct insurance/reinsurance business through an insurance broker. However, where an insurance broker is involved, insurance brokers in Saudi must be authorised and licensed by SAMA.
  
  Under Saudi law, a broker is an entity "that for compensation negotiates with the insurance company in order to conduct insurance services for policyholders". Saudi law does not distinguish between placing brokers and producing brokers.
  
  Reinsurance brokers which are not registered in Saudi Arabia are not directly regulated under Saudi law. Therefore generally, a reinsurance broker's functions and duties will be determined by the contractual arrangements between it and the reinsured, a producing broker and/or the reinsurer, as the case may be. The Implementing Regulations require insurance/reinsurance brokers to "offer to place reinsurance business with local reinsurance Companies before placement with a foreign reinsurer".

• Population
  63m (22nd)
• Global Rank (GDP)
  7th

GDP 2013
$2.4 trillion

• Economic Growth 2009
  -4.4%
• Economic Growth 2010
  2.1%
• Economic Growth 2011
  0.7%

• Inflation 2009
  2.3%
• Inflation 2010
  3.3%
• Inflation 2011
  4.5%

• Currency/Exchange Rate www.bloomberg.com/markets/currencies

• The sections below do not take into account the changes in law that will apply from 12 August 2016 according to the Insurance Act 2015.
• Reservation of Rights / Without Prejudice RuleIt is an essential principle of English law, that if a insurer/reinsurer elects to defend the insured/reinsured without reserving its rights (e.g. in equity and/or in law and/or as to a specific policy defence), it may be precluded from doing so later on. Therefore an insurer/reinsurer must reserve its rights as soon as it has become aware of any breach of the policy or breach of the duty of good faith. The 'Without Prejudice' rule generally prevents statements made (whether in writing or orally) in a genuine attempt to settle an existing dispute from being put before the Court as evidence of admissions against the party who made them. The purpose of the rule is to encourage litigants to resolve matters between themselves.
• PrivilegePrivilege entitles a party to withhold evidence, either oral or written, from production to the Court. English law recognizes two main types of legal professional privilege: legal advice privilege and litigation privilege. Under legal advice privilege, if no adversarial proceedings are in contemplation, privilege will only attach to documents which constitute confidential communications between a lawyer and his client made for the purpose of giving or obtaining legal advice and documents which evidence such communications. Litigation privilege affords a wider protection since it can protect communications with third parties, as well as those between a lawyer and his client. It applies only where adversarial proceedings are reasonably in prospect, for example where negotiations over a claim for payment are breaking down or where one party sends or receives a formal letter before action. Also, the documents must have been prepared for the dominant purpose of giving or getting legal advice with regard to the litigation or aiding the conduct of the litigation.
• DisclosureUnder standard disclosure, documents which each party must disclose are "documents" on which a party relies and which adversely affect or support either party's case. Note that documents which harm the case of the producing party must be disclosed. The purpose of disclosure is to make available evidence which either supports or undermines the respective parties' cases and allows the Court to do justice between the parties with "all the cards on the table". The purpose is also to prevent either party being taken by surprise at the trial. Disclosure can also force parties to seriously consider settlement as a way of avoiding disclosure of sensitive and/or prejudicial information to the other side.
• InterestIn the absence of an express contractual provision, the insured/reinsured is entitled to claim interest if he issues a claim form. The Court has a general discretion but will normally (but not always) award interest on any contractual debt. The practice of the London Commercial Court is to award interest at base rate plus 1%. Under Section 49 of the Arbitration Act 1996, the parties are free to agree on the powers of the Tribunal as regards the award of interest. The Tribunal has a wide discretion to award simple or compound interest from such dates and at such rates as it considers meets the justice of the case.
• CostsThe general rule is that the unsuccessful party will be ordered to pay the costs of the successful party (this is described as "the loser pays"), but the court may make a different order and has a wide discretion to do so. Such discretion depends on various factors including the conduct of the parties and whether the receiving party has wholly or partially succeeded in its case. Costs can be assessed on either the standard basis or the indemnity basis. On the standard and indemnity bases, a party will not recover costs which have been unreasonably incurred or which are unreasonable in amount. Where a party has succeeded on part of its case only, the Courts are open to arguments for orders for costs to be split. In these circumstances, percentage orders should be made as opposed to issue-based cost orders.
• Monetary CorrectionMonetary correction is not available as a matter of English law.
• Punitive DamagesPunitive damages (i.e. bad faith or exemplary damages) are not awarded for late payment of claims under a insurance/reinsurance contract, unless the contract expressly states otherwise.
• Expected length of caseGenerally speaking, a 1st instance judgment may take 15-24 months and a judgment at appellate level may take a further 6 to 10 months. A judgment at final appellate level (i.e. the Supreme Court) may take a further 6 to 10 months. Mediation is not compulsory but is strongly encouraged.

• The sections below do not take into account the changes in law that will apply from 12 August 2016 according to the Insurance Act 2015.
• Fronting RequirementsUnder English law, there is no requirement for a local fronting company or that the risk is ceded to a local reinsurance company. An insurance or reinsurance policy is governed by the law and jurisdiction chosen by the parties.
• LimitationThe conventional analysis is that the limitation period begins to run against the reinsured upon the reinsured's ascertainment of its underlying liability, which is usually established by judgment, award or settlement. The reinsured has 6 years from that date to sue its reinsurer. There is an alternate argument that time runs from the date of the original loss in property insurance.
• Conditions, Conditions Precedent and WarrantiesThe breach of a simple condition by a reinsured gives the ordinary contractual remedy of a claim for damages. It can be difficult to quantify the measure of damages sustained by a reinsurer. Certain conditions may be described as being (i) conditions precedent to the existence of a binding contract or (ii) conditions precedent to the liability of the reinsurers. A breach of (i) will have the effect of the contract of reinsurance being treated as if it had never been made. A breach of (ii) – e.g. notification of the claim being a condition precedent to liability, will entitle reinsurers to repudiate any claim in respect of which the reinsured has failed to notify in accordance with the condition. The reinsurance contract will generally continue in force; it is simply in respect of the particular claim that reinsurers will be able to repudiate liability. The rationale of warranties is that the reinsurer only accepts the risks provided that the warranty is fulfilled. Reinsurers who successfully rely on a breach of warranty by the reinsured are automatically discharged from any liability under the reinsurance from the date of breach.
• Non-Disclosure/MisrepresentationThere is a duty to disclose and not to misrepresent facts:
  1. 1. That are material to the risk. A fact is material if it would influence the judgment of a prudent insurer in fixing the premium or determining whether he will take the risk.
  2. 2. Which induce the reinsurer. The reinsurer must have been induced to enter into the contract by the reinsured's non-disclosure or misrepresentation.
  3. 3. Which are within the knowledge of the reinsured. The duty is limited to circumstances which are known or ought to be known to the reinsured.
  4. 4. Which are not within the knowledge of the reinsurer. There is no duty to disclose material facts already known to the reinsurer or which the reinsurer ought to know. The remedy for non-disclosure / misrepresentation is avoidance of the reinsurance contract ab initio.
• Please note that pursuant to the Consumer Insurance (Disclosure and Representations) Act 2012, the above rules are not applicable in the context of "consumer insurance contracts" entered into on or after 6 April 2013. A "consumer insurance contract" means a contract of insurance between "an individual who enters into the contract wholly or mainly for purposes unrelated to the individual's trade, business or profession" and "a person who carries on the business of insurance and who becomes a party to the contract by way of that business ...".
  For further information, please email geoffrey.conlin@hfw.com
• Follow the fortunes/settlementsThe effect of a clause binding reinsurers to "follow the settlements" of the reinsured is that reinsurers are obliged to indemnify the reinsured in the event that they settle a claim by their underlying insured provided that: (1) the claim as recognised by them falls within the risks covered by the policy of reinsurance as a matter of law; and (2) in settling the claim, the reinsured has acted honestly and has taken all proper and business like steps in making the settlement. In the absence of a "follow the settlements" clause (or a similar clause), the reinsured is obliged to prove that the loss falls within the underlying and the reinsurance policy. The "follow the settlements" clause is emasculated by the inclusion of a claims cooperation clause, which provides that the reinsured should cooperate with the reinsurer and not make a settlement without the approval of the reinsurer. The combined effect of both clauses, is to require the reinsurer to follow only those settlements which the reinsurer has approved. The term "follow the fortunes" is not yet a term of art as a matter of English reinsurance law and it is therefore difficult to advise on its effect. However, it would appear that the concept of following the underwriting fortunes of the reinsured is different from being bound by his settlements after a loss occurs.
• Claims Co-operation/Claims ControlA claims co-operation clause gives the reinsurer the right to be involved in the investigation and settlement of the underlying loss. A claims control clause gives a reinsurer even more influence in the handling of the original claim by the underlying insured. There are many forms of these clauses however typical features include:- (i) Notification of Loss provisions; (ii) Control Clauses of all/some aspect of claims handling; (iii) Cooperation in claims handling; (iv) Control of negotiations and settlements. What is the effect of a breach of a claims control or claims co-operation clause? If compliance with the clause is not expressed to be a condition precedent, a failure to comply may prevent reliance on any 'follow the settlements' provision, although it will normally be open to the reinsured to recover by proving its liability for the settled claim. Even if there is no claims cooperation clause, the reinsurer is still entitled to information and documents showing how the claim was made and dealt with. Also, it is always prudent to keep the reinsurer advised during the course of negotiations to settle.
• Role of the Reinsurance Broker (Producing and Placing)In a normal reinsurance chain, a reinsured will instruct producing brokers who will instruct placing brokers or Lloyd's brokers who in turn have a relationship with reinsurers.
  
  The producing broker owes direct contractual duties to its principal, the reinsured. The scope of the agency will depend on its express terms or what can be implied by necessity or course of dealing between the parties. The broker has a duty to advise and place the business with reasonable skill and care and will be liable to the reinsured for any default on behalf of its own agent, the placing broker. The placing broker, as well as owing the producing broker direct contractual duties, may also be directly liable to the reinsured, either under the Contracts (Rights of Third Parties) Act 1999 (which can be excluded) and/or breach of the duty of care in tort.
  
  The broker is therefore the reinsured's agent and, in the absence of an agreement to the contrary (e.g. possibly in a Terms of Business Agreement or TOBA), the broker generally owes no contractual duties to the reinsurer. However caution is needed in the analysis of the agency relationship as the broker may be the agent of the reinsurer for specific purposes, such as proposing retrocession cover to a reinsurer or soliciting business on behalf of a reinsurer. It is also noteworthy that a broker's commission is usually paid for by the reinsurers.
  
  The knowledge of the reinsurance broker can affect his reinsured principal. For example, pursuant to section 19 of the Marine Insurance Act 1906, where an agent has effected a reinsurance, the reinsurance may be avoided on account of any non-disclosure by the agent of any circumstance that lies within the knowledge of the agent but that is not necessarily within the knowledge of his principle.