The Central Insurance company of Iran says it is working on new options to promote and expand life insurance products.
"We are hopeful about the [positive] impact of this program on the sale of life insurance. Even though insurance companies already offer a wide range of life insurance options, a big part of our population is still unware of the benefits of life insurance cover," Ali Bonyadi Naeini, CII deputy head for planning and development affairs, was quoted as saying by the CII website.
He did not elaborate on the planned new proposals.
Insurance companies play a key role in improving public awareness about the role and significance of life insurance, he noted. "Insurers need to concentrate on innovative ways to advertise and encourage the public to buy life insurance."
Bonyadi Naeini is of the opinion that the "Sales network of insurance companies can and should do their share in boosting life insurance sale and companies should come up with incentives to convince their agents and representative offices to sell more life insurance.”
He called on insurers to take the people's daily concerns into consideration for creating new and innovative coverage.
Life insurance has become the main source of premium income for some private insurers even though it barely accounts for 14% of the industry portfolio.
Pasargad Insurance Company, affiliated to Bank Pasargad Iran, generated more than 62.4% of its premium from the life insurance segment in the last fiscal year that ended in March. The company led the domestic life insurance market with 24.3% share of the total premium last year.
CII data show that Karafarin Insurance, affiliated to Karafarin Bank, generated almost half its premium income selling life insurance.
Life insurance also was the main income source for Saman Insurance Company owned by Saman Bank during the period with 47.5%. It posted 110% growth in its life insurance segment with 7.6% market share.
Premium from life insurance outperformed income from third-party vehicle insurance in the portfolios of Sarmad Insurance Company (31.6%), Ma Insurance Company (25%), and Novin Insurance Company (18.5%).
Insurance companies generated 115 trillion rials ($4.11 billion) in premium income last year, posting 41% y/y growth. Life Insurance accounted for 15.8% of their portfolios.
Parliament had called on the sector to raise the bar and boost life insurance to 50% of the total revenue by the end of the Sixth Five-Year Economic Development Plan (2016-21) – apparently a tall order.
Bonyadi Naeini referred to the CII policy of setting up new insurance firms saying that proposals for starting specialized life insurance companies are a priority.
Middle East Life Insurance Company, affiliated to Middle East Bank, reported nearly 418% growth in its annual income, higher than all its peers.
Thus far, two specialized life insurance companies are operating in the local market, namely Middle East Life Insurance and Baran Life Insurance.
The number is expected to reach five as the regulator has granted license to three new life insurance firms. The two firms collectively account for 3.7% of the market.
