56441
Iran's Life Insurance Sector on Growth Track
Iran's Life Insurance Sector on Growth Track

Iran's Life Insurance Sector on Growth Track

Policymakers have been making great efforts for promoting life insurance, with the parliament recently requiring the industry to boost life insurance revenues from the current 12% to 50% by 2021

Iran's Life Insurance Sector on Growth Track

Iranian insurance firms generated 21.7 trillion rials ($525.9 million at market exchange rate) from selling life policies during the eight months to November 20, marking a 37.19% growth compared with the same period of last year.
Central Insurance of Iran’s database (Sanhab) also shows that life insurance accounted for 12.15% of insurers’ total premium income during the period. The share was recorded at 10.66% during the same period of last year and 11.98% in the month ending October 21.
Insurers paid 7.4 trillion rials ($179.3 million) to 240,000 life policyholders as indemnity. The payout ratio of the category stood at 34.2% for the eight months to November 21.
According to Sanhab data, insurance firms collectively earned 179 trillion rials ($4.33 billion) from selling 34 million insurance policies in all categories during the eight-month period. A year-on-year comparison of data indicates a 20.4% growth in premium income and 9.8% increase in the total number of sold policies.
The total paid claims amounted to 101 trillion rials ($2.44 billion) during the period, marking a 25.6% growth YOY.
Karafarin Insurance, affiliated with Karafarin Bank, accounted for 13.12% of the total premium income in life insurance category, a notch above other insurers. Pasargad Insurance, affiliated with Bank Pasargad Iran, and state-owned giant Iran Insurance Company followed Karafarin with 13.06% and 12.92% of the market share, respectively.
Pasargad recorded a 5.8% payout ratio for life insurance in the period. This is while Iran Insurance Company, the state-owned giant insurer, registered a 94% payout for the category.
The six authorized insurance firms located in free trade zones generated 1.1 trillion rials ($26.6 million) from selling life insurance policies during the period, registering a 165.36% growth YOY. The category accounted for 44.35% of FTZ insurance firms’ portfolio.
FTZ insurers also show that the payout ratio of the category stood at 2.5% during the period.
Life Insurance Expansion
Policymakers have been making great efforts for promoting life insurance.
The Iranian Parliament recently required the industry to boost life insurance revenues from the current 12% to 50% of the total insurance revenues by the end of the sixth five-year development plan (2016-21).
CII, the industry’s regulator, announced that it will not issue new licenses for general insurance companies, as “the industry needs more specialized insurance firms at present”.
Middle East Life Insurance Company, affiliated with Middle East Bank, obtained CII’s license recently, becoming Iran’s first insurance firm to specialize in life insurance category.
Earlier this week, the firm finalized the registration process, officially introducing Mohammad Ibrahim Amin, former head of CII, as its managing director.
Middle East is set to start operations in the coming months, which is expected to be a great boon for promoting life insurance category in Iran.
As per the law, insurers can offer approximately 16% returns on two-year term life insurance policy (cash-value life insurance). The rate for four-year term policies is also set at 16% for the first two years and 13% for the rest of the period, while for periods exceeding four years, insurers are allowed to offer only 10% return.
Banks currently offer approximately 15% on one-year deposits.
Insurers have been using various marketing methods in recent months for increasing the share of life insurance’s share in their portfolio, including through corporate sales and bancassurance.
However, Financial Tribune’s inquiries reveal that life insurance is still widely unknown among a great segment of the public.

 

Short URL : https://goo.gl/1aUCw1
  1. https://goo.gl/s6GRCi
  • https://goo.gl/EuzQVr
  • https://goo.gl/pDUlpw
  • https://goo.gl/XsRnk8
  • https://goo.gl/9jSQwv

You can also read ...

Valiollah Seif
Governor of the Central Bank of Iran said on Wednesday anti-...
Nat’l Virtual Currency in the Offing
Months after the idea was first publicized, it seems that Iran...
5th Indian Wheat Cargo Arrives for Afghanistan in Chabahar
India’s fifth consignment of wheat to be sent to Afghanistan...
Presale Crosses  96,000 Gold Coins
The presale of Bahar Azadi gold coins priced at 14 million...
Spanish Foreign Minister Alfonso Dastis met with President Hassan Rouhani on Feb, 21.
Foreign ministers of the Netherlands and Spain are in Tehran...
Lexus’ New Crossover to Break Cover  in March
Lexus will pull the covers off of the production version of...
The government has required car importers to pay the higher tariffs announced in January.
The government has finally allowed the clearance of imported...
Bank Loans Top $100b in 10 Months
Banks and credit institutions doled out more than 4.62...

Add new comment

Read our comment policy before posting your viewpoints

Trending

Googleplus