German reinsurer Munich RE has made a significant offer for covering a variety of insurance services in Iran after sanctions are eased, the Central Insurance of Iran's deputy director for reinsurance said following offers from foreign insurance companies to reengage with Iran.
Mina Sediq Nouhi said collaboration with foreign insurance companies would increase the reinsurance capacity in domestic markets while foreign insurance companies' innovations would be beneficial for the industry as it increases the penetration rate of services, the CII website quoted her as saying.
She pointed to CII's recent talks with German, Japanese, French and Swiss insurance companies and said, "Munich RE is a major reinsurance company with a gross premium of $41 billion."
Nouhi said that three major Japanese insurance companies, Tokio Marine, Sompo and Mitsui have offered risk coverage up to $200 million. Japanese insurers are currently studying Iranian regulation as they have plans to establish joint companies or buy shares of domestic companies.
The three firms are big insurers in Japan accounting for 90% of the country's market. Tokio Marine's gross premium totals $40 billion compared with Iranian insurance industry's $8.6 billion.
"Brokers from major French insurers and Swiss ECHO RE have also made offers in recent weeks," she said adding that Iran welcomed European insurance companies promoting their services.
She recalled that Russia and India had supported Iran during the international sanctions, which makes them more eligible to have a share of the market in a post-sanction era.
Iranian and European insurance companies had signed contracts worth €700 million for engineering and fire insurance services before the sanctions struck.
The official recalled that foreign insurance companies like Lloyds and Munich RE, used to account for 80% of the reinsurance coverage in Iran before the international sanctions were imposed.
However, after the country's exclusion from interbank payment system SWIFT in 2012, Asian, African and Middle East insurers' share in Iran's insurance market grew. By 2011, Asian insurers accounted for 52% of the reinsurance market and insurers from MENA 40%.
With a premium volume of around US$ 9 billion, Iran is already one of the biggest primary insurance markets in the MENA region, according to Munich RE .For the period up to 2025, premium income is expected to grow by between 5% and 6% per year on average after adjustment for inflation, yielding a premium volume equivalent to US$ 9 billion.
French Interest
The French Nasco Insurance Group is also looking forward to strengthening ties with Iranian insurers, the company's president said on Wednesday.
During his visit to Central Insurance of Iran, Gabriel Bejjani said the insurance industry in Iran is attractive for foreign companies as they have expressed their willingness to join the international market in after the sanctions are lifted, the CII official website quoted him as saying.
He added that Nasco is prepared to reenter the insurance market and said, "Nasco has always tried to preserve its market in Iran."
"We presumed early on that our office in Tehran would mostly benefit Iranian insurers. However, after a while it turned to be beneficial for both Iranians and the French as it helped the company develop its business in the region."
Nasco Insurance Group of France opened a communication office in Tehran last year. The measure was taken after the European Union lifted sanctions on several Iranian oil and insurance companies in July 2014.
Pointing to his company's recent training seminar held in Tehran Bejjini said "Nasco is willing to share its experience with Iranian insurers."
