Lebanon moves to reset the minimum capital of insurance companies

The Insurance Control Commission is seeking outside technical support for a project to reset the minimum capital of insurance entities. The call for proposals opened in January, was re-issued in February and extended in March; the deadline became 16 March 2026. The terms of reference call for a market-wide quantitative impact study and a phased implementation roadmap.

Decision No. 10/L.M.D of the Insurance Control Commission, dated 9 January 2026, invited proposals from firms to provide technical support to the Commission in the project for setting the minimum capital of insurance entities. The decision addressed local and international specialised firms; proposals were to be submitted in a sealed file to the Commission's registry at Building 87, Riad El Solh Street, Beirut Central District. The first deadline was 27 January 2026.

The decision rests on the law enacted by Decree No. 9812 of 4 May 1968 on the organisation of insurance entities, as amended. It cites in particular articles 3, 4, 13, 27 and 47, the provisions that determine the minimum capital and the solvency ratio for Lebanese and foreign insurance entities. The stated purpose is to safeguard the soundness of the insurance sector and to protect the rights of policyholders in Lebanon. The decision was signed by the head of the Commission, Nadim Haddad.

The process did not end in one round. On 12 February 2026 a further call for proposals was issued under Decision No. 64/L.M.D, and detailed terms of reference were published the same day. The deadline stated in the terms of reference was 4 March 2026.

On 3 March 2026 an extension announcement, No. 539/L.M.D, was issued over the signature of the Minister of Economy and Trade. It cited the public interest and the aim of allowing the largest possible number of bidders to submit offers in the exceptional circumstances the country is passing through. The submission period was extended to 11:00 on 16 March 2026, and the opening of bids was set for 12:00 on the same day at the office of the Minister of Economy and Trade. The announcement was signed by Minister Dr. Amer Bisat.

The title of the terms of reference states the scope: the design and implementation of a capital adequacy assessment framework for insurance companies. The document defines the Commission's aim as strengthening financial stability and enhancing policyholder protection, and states that the authority seeks to upgrade its capital requirement framework.

The tasks required of the consultant are listed. A diagnostic review of the current solvency and capital adequacy regime and benchmarking against international practice and regional peers; a proposed capital increase methodology; the definition of risk categories and capital charges covering insurance, market, credit, operational and concentration risk; and a proposed interim solvency framework for regulatory submissions.

The terms of reference also require a market-wide quantitative impact study. It is to measure solvency effects both across the market and at company level, with calibration tests run under different scenarios. Presenting preliminary findings to industry participants and incorporating their feedback into the framework is part of the assignment.

For implementation, the document foresees draft regulatory communications, Excel-based submission templates, a pilot run with selected insurers, and training for both supervisory staff and the market. Post go-live support is to extend to the first annual cycle of submissions.

The evaluation criteria are set out as well: the technical proposal carries seventy per cent and the financial proposal thirty per cent. Within the technical score, relevant experience in capital adequacy frameworks counts for thirty per cent, the quality of the methodology for twenty-five, and team expertise for fifteen.

The project bears directly on how many companies the market will carry. Raising the minimum capital is a decision that pushes companies below the threshold to raise capital, merge, or transfer their portfolios. The Commission's request for a phased implementation roadmap indicates that this outcome is to be reached over time rather than at once.