Data published by the Central Insurance company of Iran (CII), the insurance industry regulator, show further increase in the share of private firms in the growing insurance market during the last fiscal year that ended in March.
CII numbers show that the Iran Insurance Company (IIC), the only state-owned player alone accounted for 31.9% of the total premium earning while the rest (69.1%) belonged to 30 private insurers.
The IIC was the leading company also in terms of total payout accounting for 31.3% of the claims in the year.
Insurance companies generated 115 trillion rials ($4.11 billion) in premium income last year, posting 41% y/y growth.
Total payouts amounted to 64.95 trillion rials ($2.13 billion) -- up 48% from the year before. Third party vehicle insurance accounted for 35% of the total payout reaching 23.1 trillion rials ($825m), up 31%.
All said, private insurers apparently are not on the same page. The monopoly of the state giant is often censured by other companies. IIC policy of offering discounts on premium and claims is often singled out as unfair and against accepted norms of free competition.
In order to address underselling by insurance policies, the regulator has announced plans for implementing new regulations in the near future
IIC took in 31.5% of the total premium in the year before (March 2020-21) and gave 33.2% of the total payout.
While the government and CII have announced plans to reform the IIC and open the field for private insurers, the company is seen as striving to increase its footprint in the market.
In order to address underselling by insurance policies, the regulator has announced plans for implementing new regulations in the near future.
"The new rules will seek to help promote competition mainly by addressing deficiencies in current regulations…The CII does not determine rates for insurance policies in most categories. However, the insurance firms should set prices in a way that they can cover the risks," Majid Behzadpour, the head of CII told IRNA last week.
He did not elaborate.
The regulator is also planning to let in newcomers, but has stressed that it will authorize new insurers “only if they come with innovative plans”.
So far 34 insurance companies operate in Iran including offshore firms and reinsurance companies. Amin Re, Iranian Re and Saman Re are the specialized reinsurance companies.
The number is likely to reach 46 with the regulator saying that 12 new firms are getting ready to make debut, including two life insurance companies Karizma Life Insurance and Hamerz Life Insurance; three reinsurance companies, Pars Reinsurance, Tehran Reinsurance and Raya Reinsurance; and two general insurance firms, namely Pardis Insurance and Farda Insurance.
