Iran's insurance market reported decent growth in the last fiscal year (March 2022-23), with the total premium income reaching 1,754 trillion ($3.2 billion).
The y/y growth was 49.95%, according to data published by the Central Insurance company of Iran (CII), the supervisory body of the industry.
However, the performance was mixed. While some insurers saw significant growth others declined. Overall growth in premium income was impressive giving the impression that the key sector is poised for further growth.
Decline in some sectors highlights the challenges that the industry faces, including the impact of US sanctions and dire conditions of the economy billed as unstable by most independent analysts and market observers.
The biggest contributor to insurance premium was third-party auto insurance accounting for almost 31.2% of the total. Medical insurance was next with 26.16% of the total followed by life insurance 14.10%.
In terms of premium growth rate, the highest was seen in the medical category as it surged jumped by a whopping 102.68% from last year. The accident, money and transportation categories followed with 86.8%, 84.38 and 60.73% growth, respectively.
Life insurance sector’s premium registered 34.75% rise, though its contribution to the industry's portfolio was slightly lower than the year before, when it accounted for about 15.7% of total premium income of the sector.
Total insurance sold in the last calendar year was 74.11 million, up 3.65% compared to the previous year. Third-party auto insurance as usual the largest share in sales with 35.6% of the tota, followed by the driver liability category at 34.95%.
On the other hand, the highest growth in the number of insurance policies sold was the money insurance category, with a massive 1,234% growth. The engineering and "medical categories followed with 40% and 13.92%, respectively.
Insurance companies collectively sold 7.3 million life insurance policies posting 4.92% decline on the year before. Fire insurance posted the largest decline in the total number of policies sold last year -- 29.96% to 2.6 million. Total transport insurance policies sold last year also declined by 16%.
$1.83b in Claims
Total damages paid by the insurers during the period was 1,000 trillion rials ($1.83 billion), with the medical segment at the top with 35.72%.
A large part of the claims was to cover bills related to the Covid-19 pandemic. Soon after the disease struck, insurance companies were told to cover all the expenses of policyholders infected with the brutal virus and expand their scope to include PRC tests.
Interestingly, despite the devastating impact of the disease, insurers saw the pandemic as a rare development that allowed them to improve their tarnished credentials with customers who rightly complain about their strange practices, mainly in private hospitals, in demanding full payment of bills and refusing to deal with the bloated bureaucracy of insurance companies and other hassles.
More than 25 million Iranians have medical insurance.
The third-party auto and life insurance categories followed with 33.65% and 9.88% of the total claims, respectively.
In terms of damages, the "oil and energy" category had the highest growth rate at 176% on the previous year.
Medical insurance also accounted for the highest portion of claims during the period. CII figures show that from the total 69 .3 million claims, 94.7% or 64 million were for medical insurance.
Payout ratio in the last fiscal was 57.25%, up 1.70 percentage points from the same time last year.
The report said Iran Insurance Company, the only state-owned company, accounted for the largest portfolio with nearly 25% share.
