Iran: Industry shifts to using euro

Source: Middle East Insurance Review | Jun 2018

Iran’s insurance industry is shifting towards the use of the euro both at home and abroad, in a move which is aligned with the country’s overall strategy to sideline the US dollar in its financial dealings for the past few years.

“We clear our insurance premiums for reinsurance coverage to Europeans in the euro, and will receive our potential damages when they occur in euros as well,” said Dr Abdolnaser Hemmati, head of the Central Insurance of Iran (CII), the industry’s sole regulator, as quoted by the local media.

According to him, most of the foreign exchange reserves of CII and insurance companies are held in the euro.

Still, Dr Hemmati conceded that “we need the US dollar and other foreign currencies for the coverage of some existing risks”. He said this has imposed additional costs on Iran because it means costlier insurance premiums. M

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