Economy, Business And Markets

Insurance Firms Pay $1.9b in Claims

Personal auto policies solely account for 41.5% of insurers’ generated premiums.Personal auto policies solely account for 41.5% of insurers’ generated premiums.

Iranian insurance firms paid policyholders 60 trillion rials ($1.9 billion) in claims during the five-months to August 20, a 31.2% increase compared to the same period last year.

Data from SANHAB, the online database of the insurance industry, shows that the Iran Insurance Company, the only state-owned insurer, alone accounted for about 45% of total claims paid.

As usual, Personal Auto Policies accounted for the largest portion of the claims at 38.7%. Health insurance and life insurance categories were next, accounting for 35.8% and 7.5% respectively.

Insurers handled 12 million claims during the period, up by 29% year-on-year.

Insurance industry’s loss ratio stood at 60.7%, indicating 5.1% surge compared with the same period last year. According to Central Insurance company of Iran, Dana Insurance, Alborz Insurance, Hafez Insurance, Mellat Insurance, Sina Insurance, Mihan Insurance, and Novin Insurance recorded loss ratios higher than the average.

The loss ratio stood at 168.5% for health category and 70.9% for PAP category, adding to concerns over the negative impact of the two categories on insurers’ portfolios.

PAP solely accounted for 41.5% of insurers’ generated premiums during the five-month period and the health category 20.4%.

The total generated premiums of the industry reached 98.7 trillion rials ($3.1 billion) to August 21, marking 20.3% growth y-y. IIC, as the only government-owned insurance firm, accounted for 33.2% of the market.

According to the figures, 10 insurance firms–including IIC–collectively account for 85.7% of generated premiums in the period. The remaining 14.3% was shared among 19 other firms.

The share of life insurance premiums in insurers’ portfolio stood at 13.4% by Aug. 20, marking a slight drop compared with the previous month.

Despite officials’ systematic efforts to promote life insurance, the category is expected to face more declines in the coming months, as a result of the recent cut in the rate of return on life insurance policies.

The CII last month voted to cut the cap of ROR on life insurance policies from 18% to 16%, following successive cuts in bank deposit rates. The regulator also lowered the minimum duration of life insurance policies from five to two years, in an attempt to save insurance firms from possible future problems in meeting their commitments.

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