The Central Insurance company of Iran (CII), the regulator of the industry, says it plans to create a special fund to help fund innovation.
"CII will continue to support the use of advanced technologies in the sector…We intend to set up a fund to this effect and augment the recently-established innovation center," Majid Behzadpour, the CII head was quoted by the company website as saying. No further details were available.
Behzadpour stressed that the CII, as a state organization, does not intend to intervene in the working of insurers but "seeks to play the role of an accelerator for insurtech solutions and help promote creative services in the industry."
The CII recently launched its long-awaited innovation center. It has been announced that the center will not seek investment but rather focus on drawing new talent to innovate the insurance industry.
“The goal is to institutionalize the move towards innovative services across the industry. We want to see the impact of technological progress in all aspects of insurance companies namely structure, procedures and products,” Behzadpour said.
Insurance companies have been in close collaboration with the regulator for developing innovative packages to build and expand services.
Hundreds of startups and knowledge-based companies have opened in Iran with some offering insurance services. They account for almost 96% of the total online sales and are recognized as knowledge enterprises by the government with an estimated 5-trillion-rial investment.
Agents Complaints
The move towards digitalization of the insurance sector seems to have caused difficulties for insurance companies' sales network.
In May 2020 the CII instructed insurers to transfer the process of sale, renewal, and claims of personal auto policies to a special online platform.
Per law, insurance companies have been obliged to develop infrastructure for selling policies online by agents. However, most agents claim that their companies have not supported them for transforming their business. This has minimized agents' income with most of them saying that they cannot afford high costs of running digital platforms.
Bahman Souri, head of sales and marketing department at the Iranian Insurance Syndicate, recently told Chabokonline website that some 50% of the agents are operating with minimum income.
More than 94,700 insurance agents were active in the year to March 2022, 12.9% higher than the year before, the regulator said. The number of agents specializing in life insurance shot up 20.2% to 53,300.
Pasargad Insurance Company, affiliated to Bank Pasargad, alone had 42, 122 agents or 44.5% of the total across the country. Iran Insurance Company was second with 13,724 agents, followed by Asia Insurance.
CII data shows that Pasargad accounted for 73.5% of the life insurance agents during the period with 39,200 active agents.
Insurance companies had 1,395 active branches – 0.8% higher on the same period the year before. Unsurprisingly, Iran Insurance, the sole state company, had 214 branches or 15.3% of the total.
Asia Insurance and Pasargad were next with 111 and 88 branches, respectively.
CII said most branches are based in Tehran Province (16.9%), followed by the northern province of Mazandaran 5.7% and East Azarbaijan and Isfahan 4.9%.
The total number of brokers also increased 2.7% to 1,111 and the number of loss assessors jumped 81.5% to more than 1,964 by March. Nearly 32.6% of loss assessors were also based in the sprawling capital and its suburbs.
