Insurance Research Center, affiliated with the Central Insurance of Iran, has recently crafted the draft version of a comprehensive set of measures for promoting commercial insurance, as part of the Economy Ministry’s plans for improving the business climate.
Amir Safari, the head of IRC, announced that the measures have been categorized under eight major headings, addressing issues like inadequacy of regulations, regulator’s role, competition or lack thereof in the insurance industry and taxation, IRC’s website reported.
IRC is the official body responsible for disseminating knowledge and research needed for the development of insurance sector in Iran.
The dominant role of Iran Insurance Company, as the only state-run firm in the market, and the rise of unhealthy competition mostly triggered by insurers undercutting one another were identified by the think tank as some of the key challenges facing the industry.
“A special working group has been formed to implement standards touted by the International Association of Insurance Supervisors,” Safari said.
“Expanding the insurance market, both domestically and in the region, and promoting specialized insurance coverage are also among the topics discussed in the plan.”
CII has announced that it would not grant new licenses to general insurance companies. The regulator is aiming to increase the clout of specialized insurance companies, particularly in life insurance category. Currently, Middle East Bank is taking the final steps in launching the country’s first insurance firm specialized in life portfolio. The bank is one of several lenders to have recently shown interest in this sector.
The industry’s earnings from premiums totaled 226 trillion rials ($6.5 billion at market exchange rate) during the fiscal year that ended on March 19, 2016, up by 6% from a year earlier, whereas losses stood at 63.8% during the period.
During this period, insurers paid 144.6 trillion rials ($4.18 billion) in indemnities, indicating a year-on-year growth of 18.45%.
“The draft version of the plan is developed based on the country’s economic development plans and strategic vision,” Safari said, adding that academics and industry activists participated in its development.
“The blueprint will be reviewed by policymakers in the insurance industry and the final measures will come into effect after officials assess their efficiency and practicality.”
Promoting Knowledge
IRC also announced that it recently uploaded 850 research projects related to insurance industry conducted by various universities. The collection is accessible at http://lib.irc.ac.ir.
Earlier in July, Abdolnasser Hemmati, the head of CII, asked IRC to increase ties with academia. He called for launching a specialized library to provide university students and experts with easy access to insurance-related contents.
“We should encourage university students to undertake research projects in the field of insurance,” he said.
