Economy, Business And Markets

Insurance Official Elaborates on TIC Failure

Insurance Official Elaborates on TIC FailureInsurance Official Elaborates on TIC Failure

Regulations set forth by Central Insurance (primary regulator of insurance affairs in Iran) stipulate that all insurance companies are obliged to invest their capital within the real estate market, banks, and other markets but Tose’e Insurance Company (TIC) failed on several occasions to do so; the main reason that led to the company’s demise, IRNA reported, citing an industry official.

The Central Insurance had been monitoring the activities of TIC for over a year, Mohammad Parizi, deputy economy minister for banking and insurance affairs, said in a television interview Saturday night shedding some light on the matter. “During the period several cases of violations of law were spotted.”

The insurance company had repeatedly pledged (in form of written commitments) to refrain from illegal acts and to align itself with the principles, he explained. Eventually, however, once the financial statements of TIC were thoroughly assessed, the Supreme Council of Insurance nullified the company’s work permit in February, he added.

Henceforth, Iran Insurance Company (IIC), the largest state-owned insurer, took over the failed insurer’s firm. Ever since the transition, a large part of TIC’s debts to its client’s have been settled by the succeeding owner.  

Regarding the activities of Central Insurance, the official stressed that Central Insurance should refrain from interference in insurance companies’ affairs, and instead, “it must focus on monitoring the activities of the companies.”

Abootaleb Chomaghloo, an insurance expert, has also commented on the issue saying as long as Central Insurance has commercial interests in Iran’s insurance market, it is highly likely that further cases of digressions would occur. “To avoid such troubles, the policies and vision of the Central Insurance need to be corrected,” he stressed.

Central Insurance must concentrate on the macro sectors of insurance; it needs to implement precautionary measures which would prevent future possibilities of financial fraud and transgression, he said.