IIC Helps Policyholders to Cushion Virus Losses

EghtesadOnline: Iran Insurance Company has given 15 trillion rials ($65 million) in credit to policyholders who could not afford to pay their premiums due to the problems created by Covid-19.

News ID: ۷۵۰۷۶۵

22 August 2020

"The credit was extended to policyholders between March to April…Most have now settled their debts," Mohammad Rezaei, the IIC chief told IRNA.

"We also paid 5 trillion rials ($21m) in claims related to the virus," he added.

A portion of the money was given to settle claims in contract liability insurance, a new type of coverage offered by the IIC. The cover seeks to support industries facing a shortage of liquidity, he said.

IIC, the largest and only state-owned insurance company in Iran, along with Saman Insurance were the first to offer life insurance to cover hospital bills and death due to the coronavirus. The IIC said life insurance policyholders are eligible for the scheme without change in the initial policy terms.

In another move to help ease the purchase of auto insurance the company launched a new section on its website that allows buyers to pay premium in installments.

Suspension of trade, businesses and industrial closures plus travel restrictions since March hurt insurance companies’ relatively high revenue. People also are less likely to afford insurance costs on a regular basis, which will apparently add to insurers’ financial troubles.

Policyholders' debts to insurance companies now is said to be in the region of 200 trillion rials ($870m).

Insurance companies generated 11.6 trillion rials ($60m) from medical insurance during the first two months of the current year (March 20- May 20). This was 42.15% higher compared to the same period last year, though the medical category share from total premium declined to 13%.

Meanwhile life insurance posted a sharp increase in premium reaching 15.4 trillion rials ($66.9m), up 37%. Life insurance accounted for 18% of insurers' total premium -- the highest ever since records were kept.

However, there is much doubt about the sustainability of the life insurance sector because in the current hard times people are less likely to afford costly life insurance on a regular basis.

Iran reported more than 354,764 cases of the infectious disease and 20,376 deaths by Friday noon.