Iran Insurance Company, the sole state-owned and the largest insurance company, is expected to play a leading role in digitizing the sector and developing innovative services.
"Given the IIC's professional workforce, we expect IIC to help expand the scope of insurance service in the country, and foster digitalization," Gholamreza Soleimani, head of the Central Insurance company of Iran, was quoted as saying at a meeting with new CEO of IIC earlier this week.
Majid Bakhtiari was appointed the new IIC boss last week. He is tasked with improving the profitability of the company, developing a core insurance platform and diversifying services.
Elaborating on government expectations, Abbas Memarnejad, a deputy economy minister, said "IIC needs to employ innovative technology to enhance business plans and processes."
Technologies like artificial intelligence can help in pricing insurance policies along with risk assessment and management, he added.
The process of digitizing insurance procedures began in May when the CII ordered insurance companies to rewrite personal auto policies in electronic format.
Insurance companies were required to switch the process of sale, renewal, and claims of personal auto policies to an online platform.
Digitization of third party vehicle insurance is aimed at supporting customers. It was a move towards boosting efficiency of insurance companies and encouraging the use of advanced technology.
The IIC is also tasked to develop a five-year plan to boost efficiency of the company that can be used by other insurance companies.
The giant insurer alone accounts for one-third of industry's premium income. However, it has been facing serious problems in recent years such as low-return on investments and insufficient capital.
IIC announced earlier that it has plans to increase its capital from 34 trillion rials ($150 million) now to 100 trillion rials ($440m). This is while the regulator has asked IIC to increase its capital to 200 trillion rials ($890m).
The grip of the sole state-owned player is seen as a major challenge by other insurers. IIC largesse in offering discounts on premium and paying claims is considered as an unfair advantage by private insurance companies.
A recent report, however, reveals that IIC share in the market declined to 31% in the last Iranian year that ended in March 2020. The share was 35% in the previous year. The company has said it wants to increase its market share to 50%. How it intends to do that is now known.
The IIC, as the only government player in the market, sells 46% of total third-party auto insurance policies -- the industry's main source of income.
