The insurance market in Egypt has suffered for a long time from the lack of insurance awareness among individuals, so it contributes a small percentage to the GDP of about 1.1%. The Insurance Federation of Egypt aims to increase this percentage to 3% during the next three years, Mr Alaa El-Zoheiry, chairman of the federation, says.
In an interview with the newspaper El Watan, he said that he supports compulsory insurance to address the lack of insurance awareness in the market. He said, “If you open a shopping centre -- for example -- and a fire broke out in this centre, who will then pay compensation to visitors to the centre?”
In this regard, the Financial Regulatory Authority has finalised a new Bill to amend the insurance law, including provisions for 21 new classes of compulsory insurance.
These include professional liability for doctors and lawyers and comprehensive legal liability for stadiums, clubs, theatres and cinemas.
Mr El-Zoheiry said that the cost of compulsory insurance is not large. “The more the number of individuals using the service, the lower the cost, “ he said. “If the price of the ticket for a game increases slightly from EGP50 to EGP51 or for a cinema show from EGP100 to EGP101, for example – it will not make a difference to the citizen, but he or she will benefit. The insurance company receives this increase, and in return the citizen receives compensation in the event of an accident.”