Economy, Business And Markets

Insurance Industry to Benefit From JCPOA

Insurance Industry to Benefit From JCPOAInsurance Industry to Benefit From JCPOA

Iran’s insurance industry would access $20 million of its frozen assets and resume ties with European insurers once sanctions are lifted following the recent nuclear agreement between Iran and the six world powers, announced deputy director of Iran’s Central Insurance Company for reinsurance affairs on Thursday.

On July 14, Iran and the P5+1—the US, Britain, France, Russia, China and Germany—signed the Joint Comprehensive Plan of Action, based on which nuclear-related economic sanctions against Iran will be removed in exchange for Tehran limiting parts of its nuclear energy program.

Mina Seddig Nouhi said the funds blocked in European insurance firms belong to both ICIC and Iranian insurance companies. “Less than a half of total frozen assets belong to ICIC (lower than $10 million) while the rest will be owned by insurance companies,” Mehr News Agency quoted her as saying.

As foreign exchange transactions would be facilitated following Iran’s rejoining of SWIFT within the next few months, the frozen assets are expected to be released in the near future, she said, without specifying the date.

She considered activities of Iranian reinsurance companies satisfactory in terms of providing insurance coverage, highlighting that “since sanctions were imposed, both insurance and reinsurance activities have largely been handled by domestic players in the $8 billion Iranian insurance market.”

“Risk of businesses in the fields of airplanes, oil and energy have all been covered domestically over last years. However, they were previously supported by foreign insurance firms,” she added.

Due to the sanctions on money transactions, the country’s insurance-related activities became limited to Asian and African countries at the international level, she said.

However, she hoped that the insurance industry would receive an impetus following the renewal of insurance contracts with European firms once the JCPOA is implemented over the next three months.

“New contracts in the post-sanctions era would help the industry provide risk coverage for highly risky fields through taking advantage of foreign insurance firms while handling the rest domestically,” she added.

Nouhi said Iran would resume international insurance cooperation provided its debts are totally paid back by foreign insurers.

“European insurance companies have voiced interest in working with their Iranian counterparts to provide insurance coverage for the National Iranian Oil Company, as well as tankers carrying Iranian liquefied petroleum gas, crude oil, gasoline, petrochemicals, raw materials and other commodities transferred by Iranian transportation system,” she noted.