The Central Insurance company of Iran issued operation license for Saman Reinsurance Company, allowing the private firm to start operations.
As per an announcement seen on the CII website, Saman Reinsurance can cover risks related to all categories.
The regulator also issued a license allowing Iran Moein Insurance Company to move from general insurance to reinsurance. As per the CII announcement, this company will discontinue insurance business as of the beginning of the fiscal year that started on March 21.
Iran Moein Insurance Company is owned by the giant Iran Insurance Company and was established to cover risks in the free trade and economic zones.
Saman Reinsurance is the third of its kind now operating in the domestic market. Amin Re and Iranian Re were the two main reinsurance companies so far. Pars Reinsurance Company, affiliated to Parsian Bank, has also acquired a permit. Earlier in January, TehranRuck Reinsurance Company also issued a subscription notice to sell shares.
A limited number of firms have permits from the regulator to enter the gradually growing reinsurance industry. Market observers say loopholes and poor regulations are depriving the reinsurance industry from playing its deserved role.
However, imposition on the new US sanctions in 2018 plus growing demand for reinsurance has prompted investors to rise to the occasion.
According to a directive issued by the government and the High Council of Insurance, the minimum required capital for establishing an insurance firm is 5 trillion rials.
CII said earlier it had received 30 applications for setting up insurance and reinsurance firms. So far 33 insurance companies operate in Iran including offshore firms and reinsurance companies.
The number is likely to reach 46 with the regulator saying that 13 are ready to enter the market, including two new life insurance companies Karizma Life Insurance and Hamerz Life Insurance; four reinsurance companies, Saman Reinsurance, Pars Reinsurance, TehranRuck Reinsurance and Raya Reinsurance; and two general insurers, Pardis Insurance and Farda Insurance.
The regulator is also expected to issue permission in principle for five other firms, namely Etemad Insurance, Bamdad Insurance, Soroush Insurance, Persian Reinsurance, and Isatis Life Insurance.
In another update, the CII said it is working to complete the so-called “smart supervision platform”.
In a meeting with CEOs of insurance companies the newly- appointed head of CII, Majid Behzadpour, said supervision is one of crucial tasks of the CII adding that a robust and responsible supervision system would foster growth of the key sector.
He called on insurers to concentrate on developing innovative technology to help improve efficiency of the sector, the CII website quoted him as saying. He urged insurance managers to employ efficient oversight mechanisms for their internal operations.
