London, 02 July 2025: The Lloyd’s Market Association (LMA) has today announced the release of a new model clause, LMA5670 – General Sanctions Financial Crime Documentation Clause, designed to enhance the ability of (re)insurers and brokers to comply with evolving sanctions and financial crime regulations.

In response to the increasing complexity of sanctions legislation and the speed with which it is introduced, the new clause introduces a contractual obligation for (re)insureds to provide documentation upon reasonable request, particularly to deal with situations where such obligations arise mid-contract. 

The clause is intended to provide insurers and brokers with an added layer of protection and to “future-proof” their contracts by:

• Giving contractual rights to access documentation from their insureds as necessary to confirm no exposure to sanctions or financial crime regulations;
• Minimising the burden on (re)insureds by limiting such requests to information that is reasonably required, accessible through best efforts and not outside their control; and
• Automatically discharging the contract in cases where the insured has not cooperated appropriately – aligning with recent requirements from the UK authorities.

Arabella Ramage, Legal and Regulatory Director at the LMA, commented: “This clause is a practical and proportionate response to the increasing demands placed on our market by sanctions legislation. It provides clarity and contractual certainty for all parties, while ensuring that compliance obligations can be met without unnecessary disruption. Importantly, it also recognises the critical role of brokers in the compliance chain, giving them the tools they need to act responsibly and effectively.”

The clause is designed to work alongside existing sanctions clauses such as LMA3100A and LMA3200 and includes safeguards to ensure that (re)insureds are not penalised for non-compliance due to circumstances beyond their control. There is an accompanying guidance note and FAQs, as the clause is a new tool for the market.

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