The Appointed Actuary’s Role in Respect of Pricing and Pricing Adequacy
Article 51
The Appointed Actuary shall, as a minimum, in respect of every Company that is an Insurer:
1. Investigate, advise and report to Senior Management, the Board of Directors and to SAMA in the form of a Pricing Report at least annually on the Technical Pricing of the risks in the insurance company’s Medical Expense, Motor and Protection and Savings products and such other classes of business as are required by SAMA’s instructions; and,
2. In respect of Protection and Savings Insurance business:
a. Perform a profit test of the premium rates.
b. Review and advise on product development and design, including the terms and conditions of Insurance contracts and pricing, along with the estimation of the capital required to underwrite the products
3. Report to Senior Management, the Board of Directors and to SAMA on the above in accordance with SAMA’s Instructions to be known as the Pricing Report/s and Pricing Adequacy Report/s and as per the Board of Directors’ and Senior Management’s instructions.
Article 52
1. A Company and its Appointed Actuary should derive Technical Prices using the Company’s own experience where this information is available and reliable.
2. In the absence of the Company’s own experience, for example when entering a new line of business, Technical Prices may be developed from other sources, but appropriate allowance should be made for any differences between the Company’s data and the source from which the information has been derived.
Article 53
The Appointed Actuary of an Insurance Company shall submit such periodic pricing adequacy reports, comparing actual selling prices for its Insurance contracts with the relevant Technical Prices, to SAMA, the Company’s Senior Management, Board of Directors, in respect of its Medical Expense and Motor classes of business, and such other classes of business as are required by SAMA’s Instructions.
Article 54
SAMA may require an Insurance Company to submit to SAMA a supplementary pricing report or pricing adequacy report from its Appointed Actuary in such form and at such timing as it prescribes on a case by case basis at the expense of the Insurance Company.
Article 55
SAMA may require a Reinsurance Company to submit to SAMA such information on the Technical Pricing of the risks it accepts and retains, as SAMA shall from time to time prescribe.