Economy, Business And Markets

New Insurance Firms on the Way

New Insurance Firms on the WayNew Insurance Firms on the Way

Three new domestic insurance companies will soon start operations, said Rahim Mosadeq, Central Insurance company of Iran’s deputy for planning and development.

“Tejarat Insurance [affiliated to Tejarat Bank] has registered with the regulator and will start operation after CII will assess and approve the credentials of its technical managers,” Mosaddeq was quoted as saying by ISNA on Friday.

 “Middle East Insurance [affiliated with Middle East Bank] will be the only firm specializing in the life insurance sector and is currently undergoing anti-money laundry risk assessment.”

The third firm, Hekmat Saba Insurance, is also in the public offering process. As with the two other firms, Bank Hekmat Iranian is the major shareholder of in Hekmat Saba.

Iran’s insurance market is largely dominated by the only state-owned firm, Iran Insurance Company. According to CII statistics, this company accounts for 44% of the total premiums, while the rest is divided between 30 private companies.

Referring to recent changes in Iran Insurance Company’s board of directors, the official said. “Any change in insurance firms’ directors must be approved by the CII [as the industry’s sole regulator.] Since Iran Insurance has not notified the CII about these changes, they are illegal.”

Iran Insurance had announced new appointments to its board of directors in the presence of officials from the Ministry of Economy on Monday. According to Article 90 of insurance regulations, the companies’ directors’ qualifications must be approved by the CII.

Elaborating on the performance of the insurance industry, Mosaddeq noted that the premiums sold were worth about 200 trillion rials ($6.6 billion) during the eleven months ending February 20, indicating a 12% growth.”

“During the said period insurers paid claims to about 22 million policyholders,” he said without elaboration.

“Iranian Insurance Syndicate last year asked for an increase in insurance firms’ capital because some companies failed to meet the capital adequacy ratio last year,” he said. The regulator has prepared a proposal for getting a four-year permission to let the insurers raise their capital which will soon be sent to the government.