Iran's Top Insurer Expanding Frontiers

EghtesadOnline: Iran Insurance Company, the largest and the only state-owned insurance company in Iran, is planning to increase its capital to 110 trillion rials ($817 million) before the current fiscal year ends in March, the company CEO said.

News ID: ۷۸۵۳۶۸

09 February 2020

"We have plans to increase the capital mainly through revaluation of our fixed assets…This will help raise our risk retention capacity from 30 trillion rials ($222 million) to 60 trillion rials ($444 million)," Mohammad Rezaei was quoted as saying by IBENA on Saturday.

Elaborating on IIC plans to augment its sales network, Rezaei said, "For now agents account for 88% of our sales…this is projected to reach 100% in the near future".

With "more than 10,000 general agents, 2,000 life insurance agents, 255 brokers and nine branches in foreign countries," the company has the largest sales network in Iran, Financial Tribune reported.

"Our priority now is to shift IIC's main source of revenue from insurance to investments," he said.

Life Insurance Sector

The giant insurer is also working on a plan to allow life insurance policyholders to choose how their reserves will be invested by the company.

"We will invest in gold, real-estate or stock market, based on the choice of policyholders," he added.

Insurance companies generated 66 trillion rials ($584 million) from life insurance policies in the last fiscal year (ended March 2019), indicating 42.3% increase compared to the year before.

Iran Insurance Company accounted for 19% of total premiums last year. The giant insurer, however, managed to double its income from life insurance to 12.8 trillion rials compared to 6.1 trillion rials the year before.

IIC and some other insurers have been concentrating  on the life insurance segment. Subsequently, the share of life insurance from total premium income was 14.5%

According to Rezaei, IIC's total generated premium in the life insurance category amounted to 14 trillion rials ($103.7 million) during the first ten months of the current fiscal year.

Easy Payments

IIC accounted for 34.5% of industry's total generated premium with 156 trillion rials. It sold more than 27.4 million policies.

The company accounted for more than 60% of total payouts. Backed by the government, IIC has always offered easier terms for paying claims to policyholders. He added that his company is paying nearly 400 billion rials in claims per day. This is considered unfair advantage by the private insurers.

The company now is planning to launch smart platforms to make the process even easier. "Iran-e Man" [my Iran], is the name of an application which allows policyholders to receive losses [almost] automatically only after uploading photos of their cars after an accident.

It will pay an estimated 170 billion rials ($4.1 million) to Caspian Airlines, for the loss of its McDonnel Douglas jet which skidded off the runway and crossed a fence onto an adjacent highway in the southwestern city of Mahshahr in January.

IIC has generated 150 trillion rials ($1.1 billion) in premiums since the beginning of the fiscal year, up 35% compared with the same period last year. It paid 80 trillion rials ($592 million) in claims during the 10-month period.