Fines in insurance bill too steep: Zareer

Mathiveri MP from ruling People's National Congress (PNC), Hassan Zareer, has criticized the new insurance bill, claiming the fines are too steep.

This is the first time a bill on insurance has been submitted by the government. The bill was submitted by Mahibadhoo MP, also from PNC, Ahmed Thoriq.

While debating the bill, Zareer said that the Maldivian insurance sector is still in its "infancy" and that more companies need to be invited into the sector during the early stages.

He suggested revisions to the bill to facilitate a welcoming environment for new insurance ventures including a reduction on the proposed fine values.

"I believe the fines proposed in the bill are too steep. Mr. Speaker, there is possibility that the claimant may face fines simply because the other party shows a different information, or a document, or even a quotation," Zareer said.

According to the insurance bill, deliberate misrepresentation of facts with the intent of claiming insurance money is a culpable offense subject to a fine between MVR 100,000 and MVR 1,000,000 based on the severity of the offense.

Besides this, if the alleged culpable party attempts to interrupt official investigations into their alleged offenses will face a fine between MVR 75,000 and MVR 750,000.

For offenses not stipulated in the statute, culpable parties could be fined between MVR 5,000 and MVR 1,000,000 based on the severity of the offense.

Thoriq said the bill aims to strengthen regulation of the insurance sector and eliminate potential attempts of insurance fraud.

The bill also aims to establish a licensing mechanism for insurance providers and affiliated businesses, supervision of said bodies besides their regulation, and development of a legal framework for the sector.

Insurance fraud, though not severe, is an occasionally reported offense in the Maldives with cases gradually on the rise.