1)

The CBUAE may conduct a periodic examination of the Companies to ensure the soundness of their financial positions and their compliance with the provisions of this Decree-Law and the technical bases of carrying out insurance and reinsurance operations. To that end, the CBUAE may verify that the Company complies with the following:

a.

Its fulfillment of its obligations and that the CBUAE shall not be held liable for its failure to do so or its inability to continue in business;

b.

The Company does not commit any violation of the provisions of this Decree-Law or the resolutions, or instructions issued in pursuance thereof;

c.

The adequacy of measures taken by the Company on the reinsurance of risks assumed by the same;

d.

Compliance with the license conditions necessary to carry out insurance business;

e.

The Company’s total losses shall not exceed (50%) fifty percent of its paid-up capital; and

f.

The Company shall not cease to conduct its business without legitimate justification.

2)

Where the Company fails to comply with any provisions of Clause (1) above, the CBUAE may impose whatever measures or sanctions it deems appropriate, and it may impose one or more of the following actions:

a.

Serving a notice describing the nature of violation, procedures for remedying it and a mechanism for regularization.

b.

Requesting the Company or the headquarters of a foreign insurance company, as the case may be, to take the necessary measures to regularize the administrative situations therein, including deposing the Company’s Director General, Authorized Manager or any Senior Employee thereof.

c.

Deposing the Company’s Chairman and any Board Member proved to be responsible for the current status of the Company.

d.

Forming a neutral committee of experts to replace the Company’s Board of Directors for a period not exceeding (6) six months, renewable for similar period(s), if necessary, and in all cases the total periods may not exceed (24) twenty four months, defining its functions and appointing its members, chairman and vice- chairman. The Company shall bear the committee’s remuneration, as determined by the CBUAE. The procedures for electing and forming a new board of directors shall be proceeded pursuant to the provisions of Federal Decree-Law No. (32) of 2021, referred to hereinabove, at least (30) thirty days before the expiry of the committee’s work.

e.

Taking the necessary actions to merge the Company into another company, subject to the approval of the company into which it will be merged.

f.

Preventing the Company from concluding new Insurance Contracts or preventing it from carrying out one or more type of insurance.

g.

Setting out a threshold limit for the total amounts of Premiums that the Company receives from the Insurance Policies it issues.

h.

Maintaining assets in the State equivalent in value to all net obligations arising from its business in the State, or a certain percentage of its value determined by the CBUAE.

i.

Restricting the Company’s carrying out of its investment activities related to the Solvency Margin ratio, or obliging it to liquidate its investments in any of such activities for such purpose, unless the same would cause harm to the Company, as determined by the specialized expert.

j.

Appointing an independent supervisory member from outside the CBUAE to attend the Company’s board meetings and participate in discussions, without having a vote, during decision-making. The Board shall determine his duties and remunerations.

k.

Suspension of the Company’s license.

l.

Revocation of the Company’s license.

m.

Restructuring of the Company.

n.

Liquidation of the Company.

o.

Imposing a fine on the Company not exceeding (AED 100,000,000) one hundred million dirhams.

3)

The provisions of Clauses (1) and (2) above shall apply to the Insurance-Related Professionals, as commensurate with the nature of their professions.

4)

The measures set out in Clause (2) above shall be imposed by virtue of a resolution of the Governor, other than the measures referred to in Paragraphs (e), (l), (m) and (n), which shall be imposed by a resolution of the Board.