May 17, 2020 
ESR and CbCR
Economic Substance Regulations (ESR) – Insurance Business
Insurance Business means the business of accepting risks by effecting or carrying out contracts of insurance, in both the life and non-life sectors, including contracts of reinsurance and captive insurance arrangements.
A UAE business that carries on an Insurance Business would be regulated by either the UAE Insurance Authority (for a Licensee established ‘onshore’), the DFSA (for a Licensee established in the DIFC), or the FSRA (for a Licensee established in ADGM).
To prevent duplicate reporting, Licensees providing captive insurance services are not also considered engaged in a Distribution and Service Centre Business.
Insurance brokers, agents, and other UAE businesses providing insurance related services that do not involve assuming all or some of the insured risk do not fall within the definition of Insurance Business, although they may conduct activities that fall into another Relevant Activity category.
Core Income-Generating Activities of an Insurance Business
The Regulations mention the following CIGAs for an Insurance Business:
- ‘Predicting and calculating risk’ – This CIGA involves the determination of the quantification and likelihood of the insured event occurring and the likely costs, and ensuring that the premiums charged are commensurate with the risks accepted.
- ‘Insuring or re-insuring against risk and providing Insurance Business services to clients’ – This CIGA includes insuring policyholders against specific risks and providing reinsurance to primary insurers.
- ‘Underwriting insurance and reinsurance’ – This CIGA refers to the evaluation and analysis of the risks of an insurance policy, and establishing the pricing for accepted insurable risks.Examples:
- First Life LLC (UAE) provides life, health and car insurance in and
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