The head of Iran's Insurance Institute has called for the launch of a secondary exchange for the trading of life insurance policies, saying that the formation of this market would increase the liquidity of life insurance.
Mr Ali Safari said that the share of life insurance should be at least 50% of the entire portfolio of the insurance industry, reports the Mehr news agency. At present, life insurance accounts for 14.4% of the entire Iranian insurance market, according to data from Central Insurance of Iran (CII).
He put forward three proposals for the development of life insurance in Iran, saying, "These three ideas include the supply of life insurance and investment units, life risk portfolios, and the launch of a secondary life insurance market."
He added that during the duration of the insurance policy, the insured person, instead of turning to the insurance company to surrender or cancel the contract, can resort to the secondary market to trade the policy and sell it at an appropriate profit at market price.
Speaking at a recent life insurance seminar, Mr Gholamreza Soleymani Amiri, the president of CII, outlined the growth of life insurance in the country. He pointed out that in 2011, only three insurance companies were active in life insurance which formed more than 20% of their total portfolio, but at present, there are 10 companies dealing with life insurance with four of them boasting a life business which exceeds 50% of their total portfolio.
Eager to increase the share of life insurance in the overall industry to 50% as envisioned in the Sixth Five-Year Development Plan (2017-22), CII is separating life and non-life insurance activities in insurers and is promoting the establishment of life insurers.