The head of the Majlis Economic Commission, Mohammad Reza Pour-Ebrahimi, has urged the insurance regulator to spearhead a drive to hire younger executives for management positions.
He told Dr Abdolnasser Hemmati, President of the Central Insurance of Iran (CII), to get rid of old executives who should have retired years ago but are still managing the Iranian insurance industry, reported Financial Tribune.
Speaking at the 24th National Conference on Insurance and Development held in Tehran last month, he said: “Most of the past rules and regulations have not been implemented as needed, and the result is that today the Iranian insurance industry needs reconstruction. For three years, there has been a loss of consolidation in the insurance industry.”
Privatisation “is a must”
Meanwhile, Minister of Economic Affairs and Finance Masoud Karbasian said that Iran Insurance Company, which commands 60% of the insurance market, will retain its state-owned status, but the government will vigorously pursue divesting its stakes in three insurance companies, namely, Asia, Alborz and Dana.
Mr Karbasian said that the privatisation of insurance companies “is a must”. CII will remain the sole regulator and policymaker of the industry, he said.
The minister called for efforts to increase insurance penetration in Iran, adding that the share of life insurance is currently low and must rise to 50% as envisioned in the Sixth Five-Year Development Plan (2017-22). The current insurance penetration ratio of 2.2% is also envisioned to reach 7% by the end of the plan. Dr Hemmati said the Iranian insurance penetration ratio had increased to 2.2% from 0.34% over two decades.
Dr Hemmati also said that a specialised management unit will be formed within CII with the mandate of overseeing life insurance companies. The regulator is separating life and non-life insurance activities and is promoting the establishment of life insurers. M