OFAC is aware that insurers at times receive claims from non-sanctioned persons in non-comprehensively sanctioned jurisdictions for losses caused by individuals or entities on OFAC's List of Specially Designated Nationals and Blocked Persons (SDN List). For example, a U.S. insurance company may receive a claim request for death, injury, or property damage caused by a Specially Designated Global Terrorist. Under this scenario, the mere fact that a blocked person has caused the loss does not in and of itself create a blocked interest in the policy or any claim or payment under the policy, nor does it constitute a dealing involving the blocked person. Therefore, U.S. insurers may pay such claims to non-sanctioned recipients, provided the payment is not prohibited by other OFAC sanctions regulations (e.g., the recipient resides in a sanctioned jurisdiction and no other authorization applies). This guidance does not apply to scenarios in which a person is seeking reimbursement for payments that were made or will be made to a blocked person.
OFAC encourages insurers who receive claims for losses caused by a blocked person to conduct necessary due diligence to ensure there are no other potential sanctions risks associated with making or facilitating related claim payments (e.g., the involvement of a blocked financial institution).
OFAC is aware that some insurance policies may include subrogation rights, which provide a legal right for the insurer to pursue reimbursement from the liable third-party for payment of the claim. The mere existence of such rights in a situation involving a loss caused by a blocked person does not create an interest of the blocked person in the policy or claims made under the policy. However, claims paid as described above and all other obligations of the insurer on behalf of the insured (or their non-sanctioned beneficiaries) under a given policy must not be contingent on the successful pursuit of a subrogated claim by the insurer against a blocked person.
OFAC does not require U.S. persons to obtain a specific license to initiate legal proceedings against a blocked person. For example, a U.S. attorney, insurer, or other service provider initiating arbitral proceedings against a Specially Designated Global Terrorist does not require a specific license. In most OFAC programs, however, a license would generally be required to enter a settlement agreement with a blocked person, to accept payment from a blocked person, or to enforce an order or award transferring blocked property. Please see the relevant OFAC implementing regulations and the Sanctions Programs and Country Information page on OFAC's website for further program-specific information. For guidance on how to request and apply for a specific license, please see 31 CFR § 501.801 and the License Application page on OFAC's website.