EghtesadOnline: The Central Insurance company of Iran, the regulatory body of the industry, and a private insurance firm have crafted a new package for covering losses to the business community due to the coronavirus.
The package will help protect 70 types of businesses against the deadly disease, says Gholamreza Soleimani, the CII head. It was not clear which types of businesses would be eligible.
"It covers [potential] business closures and falling income", the Economy Ministry news service, Shada.ir, quoted him as saying during an event to announce the stimulus package.
The newly-designed measure covers the abovementioned losses for up to 60 days. Insurers came up with a wide range of measures to support policyholders and medical staff as Covid-19 spread, he said.
A number of insurance companies in Iran extended their medical insurance coverage to include a part of hospitalization bills of infected policyholders
More than 25 million Iranians are covered by medical insurance. Insurance companies generated 11.6 trillion rials ($50 million) from medical insurance in 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 segment’s share of total premium declined to 13%.
The sector paid a total of 6.6 trillion rials ($28m) to medical centers affiliated to the Ministry of Health to help them overcome financial constraints amid the coronavirus spread.
As per law, insurance companies are obliged to pay 10% of their revenue from third-party auto insurance - the category with the highest share in insurance companies' portfolio -- to the Health Ministry.
Some insurers extended third-party auto policies for some months without requiring customers to pay the premium in advance.
The new cover is developed by Ta’avon Insurance Company.
Insurance companies collectively generated 86 trillion rials ($357m) in premium in the first two months (March 20-May 21) of the current fiscal year – up 31.4% compared to the same period last year. CII data also shows a year-on-year jump of 12.2% in payouts, as insurance companies paid 42 trillion rials in claims.
Iranian Insurers' Syndicate recently published a report assessing the impact of the virus influence on the nascent sector. It forecast 13% increase in premiums during the current fiscal year that ends in March 2020. Insurers reported 32% growth in premium income in the previous fiscal year.
International and domestic experts stress the critical need for developing intelligent platforms, innovation and big data by insurers to mitigate losses from of the pandemic and reduce losses during future health emergencies and natural disasters.
More broadly, insurance businesses - as other sectors - need to embark on the digital transformation of their organizations, to become more agile, responsive and connected enterprises. Perhaps one legacy of the coronavirus crisis could be that it actually propels more insurers to do that.
These are extremely challenging times, economic experts say, for individuals, families, businesses and indeed whole societies and economies. The insurance industry has a key role to play in supporting customers and societies through the crisis and the recovery.