Egypt: Intermediaries' commissions to be disclosed wef 1 October
Source: Middle East Insurance Review | Sep 2020
The Financial Regulatory Authority (FRA) has stipulated that insurance companies operating in the Egyptian market will have to start disclosing in insurance policies the remuneration payable by them to intermediaries with effect from 1 October.
The regulator said the 1 October date would allow sufficient time for insurers to re-code their computer programmes for the disclosure to be made.
The authority requires all insurance companies to furnish it with the structure of payments due to intermediaries, the proportion of each kind of payment relative to the total, and entitlements related to each branch of insurance. All payments, under whatever name, are to be disclosed including commissions, fees, bonuses, incentives, etc, reported Al Mal.
The FRA announced last December its decision to compel insurance companies to include all commissions, rewards or incentives payable to insurance intermediaries in the insurance contract, to improve transparency. The decision was originally to be implemented immediately. However, insurers complained that they needed time to prepare for the disclosure. They argued that they had to reprogramme IT systems to calculate the commissions and to publish them in insurance policies.
Insurers are also required to expressly state in the insurance policy that the premium includes the value of the commissions and other payments due to the insurance intermediary. M