Questions & Answers
Procedure for liquidating an insurance bank guarantee
Hi,
I just want to know the procedure for liquidating the bank guarantee of an insurance broker with the Insurance Authority.
The labour court awarded a judgment in favour of a broker's employees. Now, these employees applied for execution and submitted a copy of the Bank Guarantee amounting to AED 3 Million.
They wish to liquidate this bank guarantee based on the amounts awarded in their respective judgments.
Do you have any idea about the process? How long this will take?
Based on the Ministerial Resolution No (218) of 2001 on the Bank Guarantees, the Article (11) giving the rights to deduct from the bank guarantee in certain conditions;
1- To cover the expenses of labour travelling back to his country.
2- Any amount that the employer agreed in favour of the employee.
3- Against the court judgments to pay the labours dues.
Regarding the process of liquidating the bank guarantee, it will be through the execution judge after opening an execution file.
Regarding the time to liquidate the bank guarantee, it will depend on the judge and the Execution Department in the court.
