Egypt: New products to be launched to boost microinsurance growth
Source: Middle East Insurance Review | May 2020
Insurers are working to provide new microinsurance products, including cover for livestock owners and small craftsmen, said Insurance Federation of Egypt chairman Alaa El-Zoheiry.
These products could be made available in the market in the next few months, after getting the approval from the Financial Regulatory Authority (FRA).
Microinsurance in Egypt is still in its infancy, with a lot of potential. At present, it covers only half a million customers although the market size could be at least 40m, according to estimates.
New legislation is needed to facilitate the growth of microinsurance in Egypt, said Milliman MicroInsurance Centre managing director Michael McCord. He suggested that legislation be passed to require insurers to provide coverage to a specific percentage of those with low income, especially those living in rural and remote areas.
He stressed that insurers must also find out what customers really need and not what their staff perceive the need to be, as well as develop a product design plan to meet the real demand for microinsurance.
The FRA has taken steps to promote microinsurance. For instance, it launched an initiative making life insurance compulsory for individuals who take out microfinance loans. In addition, a revised new insurance law, finalised by the FRA, contains provisions for microinsurance that will promote this segment of insurance.
The regulator has also issued a decision allowing microinsurance plans to be sold online, a move which is expected to boost the segment, Mr McCord said. M