Ebrahim Hamidi, a member of the strategic council of Iran's Insurance Company, regarded poor services offered by insurers as the main reason behind citizens' reluctance to take out life insurance policies.
Citing Hamidi, ISNA reported the IIC has introduced a new plan called "Man Life Insurance Policy", which is an upgraded version of its previous life insurance package.
IIC's new policy provides an investment opportunity as well as treatment coverage – up to 500 million rials ($150,000 at market exchange rate) for cancer and 200 million rials ($60,000) for other diseases.
Established in 1935, IIC is a state-owned corporation providing a wide range of insurance services. It is regarded as Iran's largest insurance firm and holds over half of the domestic market share, the report said.
Hamidi noted that due to the double-digit inflation rate (currently standing at 15 percent) people prefer to invest in high-interest deposit accounts in banks rather than in the insurance market. He explained that the company has solved this problem by offering both reasonable interests to investments and treatment coverage.
He pointed to the expertise assessment carried out by the company since 2014 to precisely evaluate weak and strong points of the current policies, while considering features of those being issued in developed countries.
Recent studies indicate that life insurance policies constitute 55 percent of the total policies issued in developed nations, since they are viewed as services that can help households with their expenditure. However, he said, the penetration ratio stands at nine percent in Iran.
Hamidi referred to the high level of life insurance penetration ratio in developed nations as a quantitative index that shows the insurance sector has considerably progressed in those countries. The figure is measured as the ratio of premiums underwritten in a particular year to the gross domestic product.
"Although the insurance industry is one of the most lucrative in the world, it has not yet properly developed in Iran," the expert said, expressing hope that the new policy would enjoy widespread reception by the public and help the insurance sector receive an impetus in consequence.
