• INMA Part 4.3 INMA Part 4.3 Professional indemnity insurance

    • INMA 4.3.1 Firms must take out and maintain professional indemnity insurance

      (1) An INMA firm must take out and maintain professional indemnity insurance in accordance with this Part.
      (2) An INMA firm is taken to comply with subrule (1) if its activities are covered by a group-wide professional indemnity insurance policy that covers the firm and its activities and otherwise complies with this Part.

      Guidance

      If the group-wide policy does not comply with this Part, the firm must obtain professional indemnity insurance that does so.
      (3) However, an INMA firm need not take out or maintain such insurance if another firm provides a guarantee for it in accordance with rule 4.3.4.
      Derived from QFCRA RM/2014-4 (as from 1st January 2015).

    • INMA 4.3.2 Minimum requirements for professional indemnity insurance policies

      (1) The amount of an INMA firm’s professional indemnity cover must be determined by the firm’s governing body, and must be adequate, having regard to the nature, scale and complexity of the firm’s business.
      (2) An INMA firm’s professional indemnity insurance policy must provide:
      (a) cover for claims for which the firm may be liable as a result of its conduct or the conduct of its employees, the members of its governing body and its agents;
      (b) appropriate cover for legal defence costs;
      (c) continuous cover for claims arising from work carried out from when the firm was authorised to conduct a regulated activity in or from the QFC; and
      (d) cover for awards made against the firm under the customer dispute resolution scheme.

      Note Customer dispute resolution scheme is defined in the glossary.
      (3) An INMA firm must not take out professional indemnity insurance that provides for the payment of fines imposed by the Regulatory Authority or the QFC Authority.
      (4) If the Regulatory Authority considers that, because of the nature, scale and complexity of a particular INMA firm’s business, the firm should increase the level of its professional indemnity insurance cover, the authority may direct the firm to take out professional indemnity insurance that provides a specified minimum level of cover.
      Derived from QFCRA RM/2014-4 (as from 1st January 2015).

    • INMA 4.3.3 Suitability of professional indemnity insurers

      (1) Before an INMA firm takes out or renews a professional indemnity insurance policy with an insurer, the firm must be satisfied, on reasonable grounds after making an appropriate assessment, that the insurer is suitable to provide the policy to the firm.
      (2) The firm must have systems and controls to ensure that the assessment remains correct.
      (3) In assessing whether an insurer is suitable, the firm must have regard to all the relevant circumstances, including the following:
      (a) the insurer’s credit rating, capital and financial resources;
      (b) its regulatory status and history;
      (c) its expertise and market reputation;
      (d) the regulatory and legal regimes of the jurisdiction in which it is located.

      Note Jurisdiction is defined in the glossary.
      (4) Without limiting subrule (1), an insurer that is not authorised in the QFC to conduct insurance business, and does not have an equivalent authorisation in Qatar or a zone 1 country, is suitable to provide a professional indemnity insurance policy to the firm only if all of the requirements in subrule (6) are met.
      (5) The zone 1 countries are Australia, Austria, Belgium, Canada, Denmark, Finland, France, Germany, Greece, Hong Kong, Iceland, Ireland, Italy, Japan, Luxembourg, Netherlands, Norway, Portugal, Singapore, Spain, Sweden, Switzerland, the United Kingdom and the United States of America.
      (6) The requirements are:
      (a) that the insurer is rated at least BBB by Standard & Poor’s or the equivalent by another rating agency;
      (b) that the firm has given notice to the Regulatory Authority about its intention to take out or renew the insurance policy with the insurer; and
      (c) that either:
      (i) the firm has received written notice from the authority stating that it does not object to the firm’s taking out or renewing a policy with the insurer; or
      (ii) 28 business days has elapsed since the firm gave the notification to the authority and the authority has not notified the firm in writing that the authority objects to the firm’s taking out or renewing a policy with the insurer.
      (7) If, at any time after the firm has taken out or renewed a professional indemnity insurance policy with an insurer, the authority considers that the insurer is, or is likely to become, unsuitable to provide the policy, the authority may, by written notice to the firm, require the firm to cancel the policy and take out equivalent professional indemnity insurance with another insurer in accordance with this rule.
      Derived from QFCRA RM/2014-4 (as from 1st January 2015).

    • INMA 4.3.4 What firms may provide guarantees

      (1) A firm (the guarantor firm) may provide a guarantee to an INMA firm for this Part only if the guarantor firm has net tangible assets of more than QR35 million.
      (2) If the INMA firm is a member of a corporate group in which there is a firm with net tangible assets of more than QR35 million, a firm that is not a member of the group must not provide a guarantee to the INMA firm.

      Note Corporate group is defined in the glossary.
      (3) A guarantee provided for this Part:
      (a) must be in writing; and
      (b) must make provision at least equal to the provision required by rule 4.3.2 (Minimum requirements for professional indemnity insurance policies).
      (4) The INMA firm must give a copy of the guarantee to the Regulatory Authority.
      Derived from QFCRA RM/2014-4 (as from 1st January 2015).

    • INMA 4.3.5 INMA 4.3.5 Notices to the Regulatory Authority

      An INMA firm:

      (a) every year, must give the Regulatory Authority a copy of the firm’s professional indemnity insurance cover for the following 12-month period;
      (b) must notify the authority of any significant changes to the cover, including the level of cover and the renewal or termination of the cover; and
      (c) must notify the authority of any significant claim against the firm of professional misconduct or negligence, or by the firm under its professional indemnity insurance cover.
      Derived from QFCRA RM/2014-4 (as from 1st January 2015).

      • INMA 4.3.5 Guidance

        Whether a claim is significant depends on the nature, scale and complexity of the firm. The Regulatory Authority expects firms to treat a series of single claims that are significant in the aggregate as significant.

        Derived from QFCRA RM/2014-4 (as from 1st January 2015).