Morocco: Insurance Comparative Guide

1 Legal framework

1.1 Which legislative and regulatory provisions govern the insurance sector in your jurisdiction?

From a legislative perspective, the Moroccan insurance sector is mainly governed by Royal Decree 1-02-238 dated 3 October 2002 promulgating Law 17-99 establishing the Insurance Code.

Other legislative provisions relating to specific subjects include the following:

• Royal Decree 1-14-190 dated 29 December 2014 promulgating Law 18-12 relating to the compensation of work accidents;
• Royal Decree 1-84-177 dated 2 October 1984 relating to the compensation of victims of accidents caused by motor vehicles; and
• Royal Decree 1-16-152 dated 6 October 2016 promulgating Law 110-14 instituting a system of coverage for the consequences of catastrophic events.

Several regulations govern the conduct of insurance business in Morocco. These include:

• Order 2240-04 of the minister of finance dated 27 December 2004 in relation to insurance contracts;
• circulars and decisions of the Moroccan insurance regulator – the Autorité du Contrôle des assurances et de la Prévoyance Sociale (ACAPS) – in relation to the remote provision of insurance transactions and the outsourcing of certain functions by insurance brokers;
• Decree 2-18-785 dated 6 May 2019 issued for the application of Law 110-14 amending and supplementing Law 17-99 promulgating the Insurance Code; and
• Decree 2-18-1009 dated 29 April 2019 issued for the application of Law 17-99 promulgating the Insurance Code.

1.2 Which bilateral and multilateral instruments on insurance have effect in your jurisdiction?

To the best of our knowledge, no bilateral or multilateral instruments have effect in the insurance industry per se in Morocco. However, certain bilateral and multilateral instruments relate to the health industry.

For example, Morocco has concluded bilateral social security agreements with 14 countries, including Belgium, Spain and France.

Bilateral instruments have also been concluded between Moroccan national bodies. One example of such an agreement is the Third-Party Paying Convention, entered into by the Fédération Marocaine des Sociétés d'Assurance et de Réassurance and the national social security fund, the Caisse Nationale de Sécurité Sociale, dated 25 November 2008.

An example of a multilateral agreement concluded between Moroccan national bodies is the agreement relating to the training of pharmacists in compulsory basic health insurance, signed between:

• the Agence Nationale de l'Assurance Maladie;
• the Conseil National de l'Ordre des Pharmaciens; and
• the Fédération Nationale des Syndicats des Pharmaciens du Maroc.

1.3 Which bodies are responsible for enforcing the applicable laws and regulations? What powers do they have?

The ACAPS is the Moroccan body that regulates the insurance industry. It has broad powers to regulate and supervise the insurance sector, including:

• financial autonomy;
• control over public and private entities that manage or carry out insurance transactions;
• the ability to propose draft legislative or regulatory texts to the government in relation to its field of operation;
• the ability to give an opinion on any draft legislation or regulations relating to insurance; and
• the ability to investigate any claims relating to insurance and reinsurance.

The ACAPS is responsible for the prudential control of insurance and reinsurance companies, and controls:

• the solvency of operators, in order to ensure that their financial situation allows them to respect their commitments towards policyholders; and
• the activities, risk exposures and capacities of regulated entities to honour their commitments.

The ACAPS exercises its control:

• by reviewing documents whose production is prescribed under the insurance regulations or requested by the ACAPS, insofar as these are necessary for its control mission; and
• by having sworn agents of the authority conduct on-site inspections. These agents may, at any time, verify the insurance operations carried out by insurers. They have access to all information necessary for their inspection missions.

In case of breach of the regulations, insurance and reinsurance companies and their managers may be subject to criminal, pecuniary or disciplinary sanctions, depending on the seriousness of the breach.

1.4 What is the regulators' general approach in regulating the insurance sector?

The ACAPS general approach is as follows:

• It ensures the protection of policyholders, affiliates, members and beneficiaries of rights;
• It controls the solvency of insurance and reinsurance companies and the financial sustainability of social security schemes;
• It verifies compliance with the rules applicable to each sector by the operators under its control; and
• It monitors commercial practices and investigates all complaints relating to operations carried out by the entities under its control.

2 Insurance contracts

2.1 What are the main types of insurance available in your jurisdiction?

There are two main categories of insurance in Morocco: insurance covering individuals and insurance covering property. Thus, according to its purpose and scope, insurance can be classified into two main categories:

• insurance against damage, including:
• • property insurance, which guarantees compensation for prejudice undergone by the policyholder following damages and losses caused to the goods belonging to him or her; and
  • liability insurance, which guarantees the pecuniary consequences of civil liability that the policyholder may incur due to bodily, material or immaterial damage caused to third parties; and
• insurance of persons, including:
• • life insurance, which aims to cover risks whose occurrence depends on the survival or death of the insured;
  • capitalisation insurance, which aims to build up savings with a guaranteed minimum return; and
  • bodily injury insurance and health insurance, which aims to cover risks to the physical integrity of the insured, risks relating to illness or maternity or risks of incapacity and disability.

2.2 Are all insurance contracts regulated? What terms do they typically include?

All insurance contracts are regulated by the Insurance Code.

According to Article 12 of the Insurance Code, insurance contracts typically include details of the following:

• the name and residence of the contracting parties;
• the insured goods and individuals;
• the nature of the insured risks;
• the time from which the risk is covered and the duration of the coverage;
• the amount of coverage provided by the insurer;
• the insurance contribution;
• the condition of tacit renewal, if any;
• the cases and conditions for extension or termination of the contract or the cessation of its effects;
• the obligations of the insured at the time of underwriting with respect to the declaration of risk and other insurance covering the same risk;
• the terms and conditions of the declaration to be made in the event of a claim;
• the time limits within which the indemnity, capital or annuity must be paid; and
• the procedure and rules relating to the estimation of damages determining the indemnity for insurance other than liability insurance.

2.3 What are the formal and documentary requirements for conclusion of an insurance contract?

According to Article 11 of the Insurance Code, the insurance contract should be written in visible characters and drawn up in at least two copies which are signed by the parties.

Even before the contract is issued, the insurer and the insured may commit to each other through the delivery of a covering note.

2.4 What are the procedural requirements for conclusion of an insurance contract?

Prior to conclusion of the contract, the insurer will give the insured a copy of the draft contract, including the price, or an information notice that describes, among other things:

• the guarantees, including limitations;
• the related price; and
• the obligations of the insured.

2.5 What are the respective obligations and liabilities of insurer and insured, both on concluding an insurance contract and during its term? What are the consequences of any breach?

On conclusion of the contract:

• the insurer must:
• • cover the losses and damages of the insured; and
  • pay the indemnity in the agreed period; and
• the insured must:
• • pay the insurance premium on the agreed dates; and
  • declare, at the time the contract is concluded, all circumstances known to him or her which are necessary for the insurer assess the risks it is assuming.

If, during the term of the contract, the insured wishes to end the contract, he or she must inform the insurer and a notice period will apply.

An insurer which has not communicated the necessary information to one or more insureds enabling them to assess their reciprocal commitments may be subject to an administrative fine. The same sanction applies where the insurer fails to pay an indemnity due under an insurance contract.

If it appears, during the term of the contract, that the insured has not paid the insurance premium within 10 days of its due date, the insurer may suspend coverage 20 days after the insured has been put on notice.

3 Making a claim

3.1 What are the formal and documentary requirements for making a claim?

There are no such requirements under Moroccan law. The requirements for making a claim are included in the insurance policy according to Article 12 of the Insurance Code. The required documentation could include, for example, a certificate of death in relation to a life insurance claim or an accident report in the case of an automobile insurance claim.

3.2 What are the procedural requirements for making a claim?

To make a claim, the insured must inform the insurer as soon as it becomes aware of any loss or damage, and no later than five days after the occurrence of any loss or damage that may give rise to the insurer's coverage.

3.3 On what grounds can the claim be denied? How can the insured challenge the denial of claim?

There are several grounds on which a claim may be denied. These grounds relate to the particularities of the policy coverage and are usually outlined in the policy. For example, a claim may be denied if an important clause of the insurance policy has been breached or if the insurance premium has not been paid by the insured.

To challenge the denial of a claim, the insured could in the first instance seize the Autorité du Contrôle des assurances et de la Prévoyance Sociale or make a complaint against the insurer. The insured could also initiate an action in the competent Moroccan jurisdiction or seek arbitration (if this is provided for by the insurance policy).

3.4 How can third parties make a claim?

While an insurance contract is a contract between the insured and the insurer, there are cases in which a third party may make a claim. This is particularly common in liability insurance, which covers accidents caused by an insured to third parties. Under Moroccan law and according to Article 62 of the Insurance Code, a third party can make a claim to the insured or the insured's insurer.

4 Form and structure of insurers

4.1 What types of insurance companies are typically found in your jurisdiction?

Under Moroccan law, and according to the classification of the Autorité du Contrôle des assurances et de la Prévoyance Sociale (ACAPS), insurance companies may be categorised as follows:

• companies involved in non-life, life and capitalisation insurance operations;
• companies involved in non-life insurance operations;
• companies involved in life insurance operations;
• companies involved exclusively in assistance operations;
• companies involved exclusively in credit insurance operations; and
• companies involved exclusively in credit reinsurance operations.

Credit insurance and guarantee operations may not be carried out by mutual insurance companies and their unions. Life insurance operations may not be carried out by mutual insurance companies with variable contributions.

4.2 How are these insurance companies typically structured and funded?

According to Article 169 of the Insurance Code, insurance companies are usually structured as public limited companies or mutual insurance companies.

4.3 Are there any restrictions on foreign ownership of insurance companies?

Moroccan law imposes no restrictions on foreign ownership of insurance companies.

5 Authorisation

5.1 What authorisations are required to provide insurance services in your jurisdiction? What activities do they cover?

Insurance activity is subject to the prior authorisation of the Autorité du Contrôle des assurances et de la Prévoyance Sociale (ACAPS); and any company that intends to carry out a transaction that qualifies as insurance or reinsurance, or is similar to an insurance transaction, is subject to the provisions of the Insurance Code.

Therefore, insurance and reinsurance companies must obtain authorisation from the ACAPS before commencing insurance operations. The insurance operations that can be carried out with ACAPS authorisation include:

• life and death insurance;
• capitalisation insurance;
• insurance against the risk of personal injury;
• insurance of vehicles; and
• insurance against credit risks.

5.2 What requirements must be satisfied to obtain authorisation?

In order to obtain authorisation, an insurance company should be governed by Moroccan law and have its head office located in Morocco. Authorisation will be given further to an opinion of the Commission de Régulation.

In considering whether authorisation should be granted, the following will be taken into account:

• the technical and financial resources of the insurer;
• the good reputation, qualifications and experience of the managers;
• the economic and professional contribution that the insurance company can make; and
• the impact on the stability and competitive conditions of the market.

5.3 What is the procedure for obtaining authorisation? How long does this typically take?

An insurance company seeking authorisation from the ACAPS should send a request for authorisation and specify the category or categories of operations that it plans to carry out.

This request should be accompanied by:

• a copy of the company's articles of association;
• the company's certificate of registration in the trade register;
• documents outlining the identity, domicile or residence of direct or indirect shareholders holding an interest of 30% or more in the company;
• a programme of the company's activities;
• the names and addresses of the banking institutions where the company's accounts are held; and
• a market study.

The request for authorisation and the documents must be deposited at the headquarters of the ACAPS.

There are no legal provisions that stipulate a timeframe for obtaining authorisation from the ACAPS.

6 Regulatory capital and liquidity

6.1 What minimum capital requirements apply to insurance companies in your jurisdiction?

According to Article 171 of the Insurance Code, Moroccan insurance companies in the form of public limited companies should have a share capital of at least MAD 50 million. According to Article 176 of the Insurance Code, mutual insurance companies should have an establishment fund of at least MAD 50 million.

6.2 What liquidity requirements apply to insurance companies in your jurisdiction?

Insurance and reinsurance companies must record in their liabilities and represent in their assets:

• sufficient technical provisions for the full settlement of commitments entered into with insureds, policyholders and beneficiaries of contracts;
• senior receivables and payable debts;
• a reserve for loan amortisation;
• a reserve equal to the total technical provisions chargeable to the social security scheme set up by the company in favour of its employees; and
• guarantee deposits from agents, policyholders and third parties.

Technical provisions are established according to the nature of the operations carried out by the insurance or reinsurance company.

7 Supervision of insurance groups

7.1 What requirements apply with regard to the supervision of insurance groups in your jurisdiction?

The supervision of insurance companies in Morocco is conducted by the Autorité du Contrôle des assurances et de la Prévoyance Sociale (ACAPS).

In conducting its on-site supervision mission, the ACAPS can verify:

• the financial situation of an insurance company; and
• its compliance with the commitments contracted with regard to the insureds or beneficiaries of contracts.

In conducting its documentary supervision mission, the ACAPS can request all documents required under the insurance regulations or otherwise requested by the ACAPS.

The control of the ACAPS will also extend to any company in which an insurance company holds, directly or indirectly, more than half of the capital, including subsidiaries and branches of insurance companies which are located outside Morocco.

8 Reporting, governance and risk management

8.1 What key disclosure requirements apply to insurance companies in your jurisdiction?

The key disclosure obligations of an insurance company include, for example, operations involving the transfer of some or all of its portfolio of contracts, together with all rights and obligations, to one or more other insurance companies. Such a transfer must be disclosed in advance to the Autorité du Contrôle des assurances et de la Prévoyance Sociale (ACAPS).

8.2 What key reporting requirements apply to insurance companies in your jurisdiction?

Insurance companies are subject to reporting obligations, which include the following:

• A report on the company's solvency must be submitted to the ACAPS at the end of each financial year; and
• Following the closing date of each financial year, and prior to holding their annual general meeting, insurance companies must publish their detailed annual summary statements in a legal gazette by 31 March at the latest.

8.3 What key governance requirements apply to insurance companies in your jurisdiction?

Governance requirements are mainly included in the Insurance Code and include the following:

• Specific requirements apply to insurance companies regarding matters such as board size and composition;
• The governance system of an insurance company should be well organised and determine clear responsibilities, functions and bodies of the insurance company; and
• Any agreement between an insurance company and one of its administrators or one of its shareholders that holds, directly or indirectly, more than 5% of the capital or voting rights should be submitted to the board of directors for prior authorisation, and should be brought to the attention of the ACAPS.

8.4 What key risk management requirements apply to insurance companies in your jurisdiction?

According to Moroccan law, insurance companies should establish an internal control system to identify, prevent, assess, manage and monitor risks.

9 Senior management

9.1 What requirements apply with regard to the management structure of insurance companies in your jurisdiction?

An insurance company should establish a governance system which:

• is tailored to its specific activity;
• guarantees its sound and transparent management; and
• clearly defines the decision-making process and the missions and responsibilities of the persons in charge of its direction or management, and the functions that they will undertake to ensure its proper operation.

For this purpose, the insurance company should have an internal audit structure which reports directly to the board of directors or supervisory board, and whose mission, in particular, is to verify the effectiveness of the internal control system.

9.2 How are directors and senior executives appointed and removed? What selection criteria apply in this regard?

For insurance companies with an administration board:

• the executive direction is assumed by the chairman of the board of administration or by an executive director. Both are elected by the administration board and may be removed at any time by the same board for just cause; and
• where the direction is assumed by an executive director, he or she may be appointed either from among the shareholders or from outside the company, and may thus be an employee of the company.

For insurance companies with an executive board and a supervisory board:

• the members of the executive board are nominated by the supervisory board, which designates one of them as the chairman. They may be removed by the shareholders' meeting or by the supervisory board if so authorised by the articles of association;
• the board will choose one or more directors from among its members;
• the members of the executive board should be natural persons and should not be shareholders, although they may be company employees; and
• the members of the executive board may be removed by the general meeting.

9.3 What are the legal duties of directors and senior executives of insurance companies?

According to Article 195 of the Insurance Code, the directors and members of the management or supervisory board are liable individually or jointly, as the case may be, to the company and to third parties for:

• infringements of the laws and regulations applicable to mutual insurance companies;
• violations of the regulations applicable to mutual insurance companies;
• breaches of the articles of association; or
• misconduct in their management.

If several directors or members of the management board or supervisory board participated in the relevant acts, the court will determine the contributory share of each in awarding compensation for damages.

An action for damages against directors and members of the management or supervisory board will be barred once five years have elapsed since the date of the harmful event or, if it was concealed, since the date of its disclosure.

However, if the act qualifies as a crime, an action for damages will be barred after 20 years.

9.4 How is executive compensation regulated in your jurisdiction?

According to Article 196 of the Insurance Code, if a mutual insurance company has a board of directors, the board will choose one or more directors from among its members or, if the articles of association so permit, from outside its members. The powers and remuneration of those directors are determined by the board of directors.

10 Change of control and transfers of insurance companies

10.1 How are the assets and liabilities of insurance companies typically transferred in your jurisdiction?

Insurance companies that transfer insurance business are subject to the authorisation of the Autorité du Contrôle des assurances et de la Prévoyance Sociale (ACAPS), as the competent authority for issuing and withdrawing authorisations relating to the exercise of insurance and reinsurance activities.

The liabilities of insurance companies can be transferred through:

• a merger;
• the transfer of a portfolio of contracts; or
• a takeover.

The ACAPS is thus responsible for issuing various authorisations relating to the following, among other things:

• mergers between insurance and reinsurance companies;
• the transfer of a portfolio of contracts and/or claims from one insurance and reinsurance company to another;
• the takeover of an insurance or reinsurance company.

10.2 What requirements must be met in the event of a change of control?

According to Article 172 of the Insurance Code, insurance companies in the form of limited liability companies must obtain the prior approval of the ACAPS for:

• any change in the majority; or
• any disposal of more than 10% of the shares and any direct or indirect takeover of more than 30% of the share capital.

Acquisitions of shares or takeovers of insurance companies may be prohibited by the ACAPS if it considers that they are contrary to the general interest.

Moreover, Article 230 of the Insurance Code provides that insurance and reinsurance companies may not merge, split up or be absorbed without the prior approval of the ACAPS, which will be granted further to an opinion of the Commission de Régulation. Any application that remains unanswered after a period of 60 days will be deemed to have been accepted by the ACAPS.

11 Consumer protection

11.1 What requirements must insurance companies comply with to protect consumers in your jurisdiction?

Under Moroccan law, consumer protection is regulated by Law 31-08 on consumer protection and by the Insurance Code. Insurance companies have several obligations in this regard, which include the following:

• Prior to conclusion of the contract, the insurer will give the insured a copy of the draft contract, including the price, or an information notice that describes, among other things:
• • the guarantees, including limitations;
  • the related price; and
  • the obligations of the insured.
• Before it is issued, any draft contract that an insurance company intends to issue for the first time should be validated by the Autorité du Contrôle des assurances et de la Prévoyance Sociale (ACAPS). The ACAPS may also require the advance submission of any contractual or advertising documents relating to an insurance transaction.

11.2 What other measures has the state implemented to protect consumers in the insurance sector?

The fundamental mission of the ACAPS is to ensure that the rights of insureds and beneficiaries are preserved.

The ACAPS ensures that insurance companies and intermediaries put in place the necessary procedures and means to meet two main requirements effectively, continuously and efficiently:

• Citizens must be informed of the characteristics of the coverage offered, in order to enable them to make informed decisions on whether to enter into an insurance contract and on the practical modalities of execution of such contracts.
• The fair treatment of insureds must be ensured – in particular, with respect to:
• • the handling of requests and claims;
  • the proper performance of obligations and commitments under insurance contracts; and
  • the design and marketing of insurance products that meet the needs of different consumer groups.

To this end, the ACAPS ensures the adequacy of the systems implemented by insurers and insurance intermediaries to comply with these requirements.

12 Data security and cybersecurity

12.1 What is the applicable data protection regime in your jurisdiction and what specific implications does this have for insurance companies?

In terms of personal data protection, the regulations that apply in Morocco include:

• Law 09-08 promulgated by Royal Decree 1-09-15 of 18 February 2009 on the protection of individuals with regard to the processing of personal data;
• Law 132-13 approving the protocol to the European Convention for the Protection of Human Rights and Fundamental Freedoms with regard to the processing of automated personal data, promulgated by Royal Decree 1-14-136; and
• Decree 2-09-165 of 21 May 2009 implementing Law 09-08 relating to the protection of individuals with regard to the processing of personal data.

Under these regulations, insurance companies are required in particular:

• to guarantee customers the right to access and rectify their personal data; and
• to implement technical and organisational measures and data protection policies to ensure the lawfulness of data processing and ensure an adequate level of data security.

12.2 What is the applicable cybersecurity regime in your jurisdiction and what specific implications does this have for insurance companies?

As regards cybersecurity in Morocco, the applicable regulations are mainly set out in the following instruments:

• Law 05-20 relating to cybersecurity;
• Decree 2-15-712 establishing the mechanism for the protection of sensitive information systems of vital infrastructure; and
• Bank-Al-Maghrib Directive 3-W-16 dated 10 June 2016 relating to the minimum rules to be observed by credit institutions when carrying out penetration tests of their information systems.

The implications for insurance companies include obligations:

• to assess the security of their information systems, which includes the regular conduct of tests within an overall framework for assessing the effectiveness of security systems based on a risk-based approach; and
• to undertake risk mapping of their information systems with regard to the risks of hacking or cyberattacks.

13 Financial crime

13.1 What provisions govern money laundering and other forms of financial crime in your jurisdiction and what specific implications do these have for insurance companies?

In Morocco, the provisions on money laundering are mainly set out in Royal Decree 1-07-79 enacting Law 43-05 relating to the fight against money laundering.

In December 2019 the Autorité du Contrôle des assurances et de la Prévoyance Sociale published Circular AS/02/19 on the due diligence and internal monitoring obligations of insurance and reinsurance companies and insurance intermediaries. This circular is based on the provisions of Law 43-05 and on the international standards in this field. Among other things, it provides specific definitions of ‘anti-money laundering' and ‘combating the financing of terrorism', and specifies the regulatory requirements for entities in the insurance sector.

Insurance companies are subject to Law 43-05 and have several obligations thereunder, such as:

• an obligation of vigilance;
• an obligation to conduct internal monitoring; and
• an obligation to report suspicious operations.

14 Competition

14.1 What specific challenges or concerns does the insurance sector present from a competition perspective? Are there any pro-competition measures that are targeted specifically at insurance companies?

The Moroccan insurance market is competitive and competition is regulated by the Moroccan Competition Council – the body which regulates competition under Moroccan law, including in the insurance market.

The Competition Council and the Autorité du Contrôle des assurances et de la Prévoyance Sociale (ACAPS) together regulate and punish several types of conduct, such as refusal to deal and tied selling.

From a competition perspective, the Moroccan insurance sector faces the following challenges:

• anti-competitive agreements through which Moroccan insurance companies unilaterally make changes to contracts with their insureds without consulting them, in particular regarding the prices charged for the insurance products that they market; and
• a lack of responsiveness among regulatory institutions – in particular, the Competition Council and the ACAPS – with regard to competition issues; and a lack of reports and studies on competition issues conducted by these authorities.

15 Restructuring and insolvency

15.1 What provisions govern insolvency in your jurisdiction and what specific implications do these have for insurance companies?

The provisions governing the insolvency of insurance companies in Morocco are set out in Title VI and following of the Insurance Code.

According to the Insurance Code, where it appears from a review of its accounting and financial documents that an insurance company's financial situation may not provide sufficient guarantees to enable it to meet its commitments, the Autorité du Contrôle des assurances et de la Prévoyance Sociale may either:

• prohibit the company from entering into new contracts in one or more categories of operations for which it has been approved for up to two years. This prohibition must brought to the attention of the public by the company concerned:
• • by means of a notice posted on its premises and those of the insurance intermediaries responsible for collecting such subscriptions; and
  • by publication in two newspapers authorised to publish legal notices.
• Contracts taken out in contravention of this prohibition are null and void. However, this nullity is not opposable to the insured, subscribers and beneficiaries of contracts in good faith; or
• require the company to present it, within a timeframe specified by the court, with a recovery plan (plan de redressement), which must set out the measures it proposes to take either to redress its financial situation in order to meet its commitments or to strengthen its administrative, technical or accounting structures which are necessary for the category or categories of operations for which it has received authorisation.

16 Trends and predictions

16.1 How would you describe the current insurance landscape and prevailing trends in your jurisdiction? Are any new developments anticipated in the next 12 months, including any proposed legislative reforms?

This year has been a landmark year for the insurance sector in Morocco, as the Solidarity Fund against Catastrophic Events became operative upon publication of the latest orders of the minister of economy and finance. This has introduced a new system for coverage against the consequences of catastrophic events of both natural and human origin.

Meanwhile, the COVID-19 pandemic has exposed insurance companies to new systemic risks. In this regard, the Autorité du Contrôle des assurances et de la Prévoyance Sociale took several measures with the aim of mitigating the impact of the crisis, including the following:

• the spreading over two exercises of the allocation to be recorded this year for the provision for liquidity risk; and greater flexibility in the rules on the depreciation of investments, provision for unpaid receivables and premiums and provision for depreciation of receivables from intermediaries and policyholders; and
• the reform of the solvency reference framework, with the aim of establishing a risk-based solvency prudential framework. The new framework aims to:
• • strengthen the resilience of insurance companies;
  • improve their governance system; and
  • promote their transparency.
• The second component of the reform – relating to qualitative requirements in terms of governance and risk management – should be deployed from 2021 onwards.

17 Tips and traps

17.1 What are your top tips for insurance companies operating in your jurisdiction and what potential sticking points would you highlight?

One of the main challenges of the Moroccan insurance sector is the low level of satisfaction among insureds. Moroccan insurance companies have a long way to go in order to improve relations with insured consumers in terms of the provision of advance information, support and compensation – for example, through:

• streamlined, remote procedures;
• shorter response times;
• more efficient follow-up; and
• simplification of contracts.

Moreover, Moroccan insurance companies should comply with the publications of the Autorité du Contrôle des assurances et de la Prévoyance Sociale (ACAPS) (including guidelines and recommendations), and should be transparent in their interactions with this proactive regulatory authority. Moroccan insurance companies should also keep abreast of any changes in the Moroccan legislative framework.

The most recent ACAPS report, dated 4 January 2021, focused on the state of the insurance sector in 2019. It indicated that turnover in the insurance sector remains fairly high, ranking second in Africa overall.

Finally, insurance companies have been able to provide compensation for the financial impact of the COVID-19 health crisis due to various prudential measures adopted by the ACAPS.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.