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Iran insurance industry ready to attract foreign investment

A two-day business meeting between Iran and Europe was held with the presence of some Iranian officials and managers in various fields of industry, commerce, banking and insurance, ambassadors of several major European countries to Tehran and economic activists from Iran and other parts of the world in Zurich, Switzerland on October 3-4.

(SHADA: TEHRAN) -- Speaking on the forum, Parviz Khosroshahi, deputy president of the Central Insurance of Iran, said: After the implementation of JCPOA, significant developments occurred in the Iranian insurance industry; in particular, the ratio of foreign reinsurance fell sharply to less than 1 percent. In another development, about 70 percent of Iran's tanker ships and more than 45 percent of Iranian ships have been able to use the international IG’s insurance coverage. Also, the ships insured by the P&I institutions can now enter the ports of European countries.

The Iranian insurance industry has abundant untapped capacities, which is a very good and productive platform for foreign investment, he said, adding: The net stock of capital in Iran is close to $1,400 billion, and the risk involved in this capital is estimated at over $3,000 billion; in other words, the actual and potential demand for risk coverage in the Iranian economy is over $3,000 billion, of which only less than 30% is currently covered by insurance.

Khosroshahi further stated that in Iran only 13 percent of vehicles have car insurances and 18 percent of the Iranians have life insurance.

Pointing to the growth of the penetration rate over the past 20 years, he said: The penetration rate of the insurance industry or the ratio of insurance industry's manufacturing premium to gross domestic product in Iran has been steadily rising. Over the past 20 years, the Iranian insurance industry has grown 4.5 times the total economy of the country, which is a clear indicator of the high and insignificant potential of the Iranian insurance industry for investment development.

The Iranian insurance industry faces two major constraints, he noted, adding: Limitation of financial resources, and technical constraints, especially in risk assessment and risk management after risk acceptance.

Khosroshahi also stated that the Central Insurance of Iran is fully prepared to help Iranian insurances interact with foreign insurances on the basis of mutual benefits.

According to him, the Central Insurance Supervisory Standards, both in terms of subject and method, are very similar to the standards used in other countries, although there are some differences: We, like most countries, control the wealth of insurance companies, monitor their holdings, examine their investments, and apply corporate governance rules to regulate and manage the interests of stakeholders.

In the end, he said the Central Insurance of Iran would help foreign insurance companies to invest in Iran’s insurance industry.

 
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