Insurance in Brunei

The Brunei Darussalam Central Bank (BDCB) supervises insurance and Takaful in Brunei. It registers and regulates providers, protects policyholders, and promotes stability, transparency and fair treatment. The legal bases are the insurance law (Insurance Order 2006), the Takaful law (Takaful Order 2008), the international insurance and Takaful law (International Insurance and Takaful Order 2002), and the motor-vehicle third-party-liability law (Motor Vehicles Insurance (Third Party Risks) Act Cap. 90). In December 2024, there were 11 licensed companies: five for Life or Family and six for General or Non-Life. There was also one registered insurance broker and 489 registered agents, including 239 for General and 250 for Life or Family. There was no local reinsurer or retakaful provider. The sector figures for 2024 are unaudited: assets amounted to BND 2.1 billion, gross premiums and contributions amounted to BND 346.4 million, and insurance penetration was 1.7 percent. The solvency ratio was 162.9 percent, compared with a minimum of 120 percent. Takaful accounted for 28.2 percent of assets and 47.8 percent of gross premiums and contributions. In conventional insurance, the insurer assumes an agreed risk in return for a premium. Takaful, by contrast, is based on sharia-compliant risk-sharing and uses, among other models, profit-sharing (Mudharabah) or agency (Wakalah) models. A conventional insurer may not offer Takaful products, and a Takaful provider may not offer conventional products. There is no combined licence for both business forms; Takaful providers also need a sharia advisory board. Insurance cover can be obtained directly from a licensed company or through an agent registered with the BDCB. An agent may represent no more than three insurers or Takaful providers. The current BDCB register should be checked before entering into a contract. With an unlicensed provider, the contract may not be enforceable, and there is no BDCB protection. General insurance includes, among other types, motor, property, marine, energy, engineering, liability, accident and Workmen’s Compensation insurance. In 2024, 365,042 General policies or certificates were issued. Motor accounted for BND 90.0 million or 42.4 percent of General premiums and contributions; property insurance accounted for BND 28.9 million, Workmen’s Compensation for BND 19.4 million, Personal Accident for BND 16.0 million, and liability insurance for BND 11.0 million. Property insurance was also established, with 27,181 policies. The sum insured, exclusions and claims handling are determined by the relevant contract. Life and Family products in 2024 included Term with BND 19.1 million and 32,353 policies, Endowment with BND 6.0 million and 1,134 policies, Whole Life with BND 5.0 million and 360 policies, group insurance with BND 2.2 million and 1,292 policies, and Investment-Linked products with BND 0.6 million and 166 policies. Medical and Health products are insurance products within the market, but they are not part of general healthcare provision in substance. Overall, 257,003 Life and Family policies or certificates were in force. The premium, medical underwriting, sum insured, waiting period, cancellation, paid-up status and surrender value depend on the product contract. In principle, using a motor vehicle on public roads requires a Third-Party policy or an approved alternative security. Proof of insurance is also required when applying for a driving licence. The statutory cover mainly concerns the death of and bodily injury to third parties. A violation may result in a fine of up to BND 10,000, imprisonment for up to twelve months and disqualification from driving for up to twelve months. Subject to its conditions, the law also protects injured third parties in cases of insolvency or avoidance of the insurance contract. After a road accident, the parties should exchange details, photograph vehicle numbers and damage, and inform the insurer through its hotline. The Accident Reporting Centre (ARC) must be notified within 24 hours or on the next working day. The policy may additionally require a general claim notification within a specified period, such as within seven days. In cases involving death or injury, damage to government property, or a taxi, bus or other transport for payment, exceptions to the usual Motor Claims Guidelines apply; the police should then normally be contacted. The police should also be informed in the event of a road accident, death or injury, or theft. This is followed by immediate notification to the insurer, submission of the policy and supporting documents, and the claim form with evidence. Under section 27 of the Workmen’s Compensation Act Cap. 74, an employer must generally insure liability towards an employee with an approved insurer. Exceptions or an alternative security may be provided for by Gazette rules. In 2024, 28,701 policies with BND 19.4 million in premiums and contributions were recorded for this purpose. The SPK under the National Retirement Scheme Order 2023 is not an insurance contract, but it provides functional protection for income in old age and for eligible dependants. The system began on 15 July 2023. Members pay 8.5 percent of their salary into the SPK Member Account; the employer pays the prescribed rate into the joint SPK Retirement Account. From age 60, the Member Account can be paid out, while the Retirement Account enables a monthly annuity. For citizens and stateless Permanent Residents, a lifetime annuity with a minimum value of BND 250 is provided. For foreign Permanent Residents, SPK Basic applies for up to 20 years or until exhaustion, with a minimum payment of BND 500. These benefits do not replace private life, accident or health insurance. Insured persons must provide complete and accurate information, especially about health information, contract terms and exclusions. They should keep policies, certificates, payment receipts and claim documents securely and report claims within the contractual period. If information is incorrect, the insurer may reject an indemnity claim. There is no general right of transfer or switching for premiums, contributions, renewals, cancellation, non-payment, surrender or a change of provider that is evidenced in the reviewed primary sources; these consequences depend on the relevant contract. For a complaint, the provider’s Complaints Handling Unit or the responsible Complaints Officer should be contacted first. A final response should be issued within 30 working days; if there is a delay, the provider must give the reason in writing. If the matter remains unresolved after 90 business days, it may be referred using form FCI-01 to BDCB Financial Consumer Issues. The BDCB may investigate for up to six months; mediation through the Brunei Darussalam Arbitration Centre may also be considered. Court jurisdiction varies: Small Claims up to BND 10,000, the Magistrates’ Court up to BND 50,000, the Intermediate Court up to BND 300,000, and the High Court from BND 50,000. Fraud or unlicensed activity may be reported to the Royal Brunei Police Force or the BDCB. In an insolvency, policyholders have priority over ordinary unsecured creditors under section 68 of the Insurance Order 2006, subject to preferential claims. The Policy Owner’s Protection Fund under section 69 protects life insurance and statutorily required insurance. Full liability cover is provided for compulsory insurance and generally 90 percent for life insurance; statutory exceptions and limitations remain applicable.