Business And Markets

Insurance Regulator to Review New Agent Commission Rules

Insurance Regulator to Review New Agent Commission Rules
Insurance Regulator to Review New Agent Commission Rules

The Central Insurance company of Iran agreed to review its newly-announced framework about agent and brokers' commissions, which has raised objections among insurers.
The decision was made during a meeting on Thursday, in which representatives from insurance companies and sales network expressed their concerns with the CII officials.
Last week the CII published the new framework, setting new caps for agents and brokers' commissions from selling insurance policies in life and non-life categories. The new rule was set to come into effect as of September 22.
The CII officials say that the new framework would help increase the sales network's income. The sales network, however, believe that the new rates are set hastily without being fully studied, Risknews reported.
"Agents do not favor the new rates…Policymakers have made the decision without getting agents comments…The new framework is likely to weaken the sales network," Insurance Agents Union said in a letter sent to the CII.
Risknews' studies indicate considerable decline in agents' earnings (up to 25%) when the commissions are calculated based on the new rates.
The number of insurance agents registered an annual growth of 17% to reach close to 64,000 by March 2019, according to the CII. The total number of branches of insurance firms across the country reached 1,258 by March 2019 – up 6% compared to the year before.
The total number of brokers increased by 35% and reached 834 by the end of the previous year.
Iran Insurance Company, the largest and sole state owned insurance company, has the largest sales network with more than 9,000 agents and 209 branches.
The privatized Asia Insurance Company comes next with 3,200 agents and 100 branches. Pasargad Insurance Company ranks third with 73 branches and 2,700 agents.

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