Even as the Financial Regulatory Authority (FRA) has announced the preparation of a standard divorce insurance policy, questions are raised about the premium payable for divorce insurance, the amount of compensation, the reason for the issuance of the policy, and the legality of its issuance.
In response to the questions, the FRA is preparing an actuarial study to determine the premium rates and compensation amounts for divorce insurance. It has asked for official data on the average annual number of marriages and divorces.
Mr Khalid al-Nashar, FRA deputy chairman, said that in divorce insurance, compensation will be paid as soon as the wife receives a declaration of divorce, according to local media reports.
Mr Reda Abdel Moaty, also a FRA deputy chairman, said that the regulator found that the divorcees take a long time to obtain the alimony judgment. To help those women who suffer from a lack of reliable income, divorce insurance would make immediate disbursements as soon as a divorce is declared. The compensation helps her cope with daily living until she receives alimony.
Divorce insurance is one of 21 classes of business that are to be made mandatory in Egypt's recently finalised draft insurance law. The FRA will present the finalised draft new insurance law to the Council of Ministers for approval and then submit the Bill to Parliament.
The government's push to make divorce insurance compulsory has kicked off controversy. There is doubt as to whether or not it will help reduce divorce rates in the country. Some feel that divorce insurance premiums would be a burden on the husband. As a consequence, some young people would become reluctant to marry because of increased costs of marriage.