The Central Insurance company of Iran, the regulatory body of the sector, is working on a plan to offer insurance cover for bank card holders.
Gholamreza Soleimani, the CII head, says the plan calls for covering debit and credit cards against illegal use, theft and fraud, IRIB quoted him as saying on Saturday.
Soleimani referred to the high number of bank card fraud cases in recent years, saying that the industry is striving to help address understandable concerns of the largely debit card holders.
More than 118.8 million bank cards were used at least once in the calendar to August 22. Debit cards topped the list accounting for 95% (113.63 million) of the total active cards. The share of credit cards decreased 10.36% to 0.25% of the total bank cards used in the month.
Credit cards are still not a norm in Iran and for long were limited to VIPs. But now that is slowly changing. The Central Bank of Iran policy of promoting credit cards as an instrument for microloans is influencing banks' decision to rethink.
The official also said that the CII has recently launched a Risk Assessment Center to determine the technical aspects of the bank card coverage.
Promoting innovative services has been on the industry's schedule in recent years. Policymakers aim to persuade insurance companies to shift focus from the mandatory third-party auto insurance to increase the penetration of insurance services and ultimately help increase the profitability of insurers.
A recent study shows that insurance companies are developing and offering innovative services. Innovative proposals approved by the CII reached 14 in the fiscal year to March 2019.
A review of CII approvals in 15 years shows the average number of innovative insurance services offered barely exceeded five each year. However, third-party vehicle insurance still accounts for more than a third of the industry's portfolio.
As per available data insurance companies collectively generated 317.2 trillion rials ($1.16b) in premium in the four months of the calendar year that started in March.
The mandatory third-party car insurance remains the main source of premium income. Insurers sold 6.96 million third-party auto insurance policies last year worth 113 trillion rials ($418 million), posting 45.9% growth in value but 0.9% decline in total policies sold.
"Insurance companies should provide diverse services. It is rasher regrettable that most have remain focused on third-party vehicle insurance," Soleimani was quoted as saying.
