News Middle East21 Oct 2019

Egypt:8 insurers increase capital

21 Oct 2019

Eight insurance companies in the Egyptian market have increased their paidup capital by EGP339m ($20.85m) in the year to date, to reach a combined total of about EGP1.3bn.

The objectives for the increases varied from conforming to the proposed new insurance law that raises the minimum capital of insurers to serving the needs of business expansions through the introduction of new products to attract different market segments, or geographical expansion across the country, reported Al Mal.

Of the eight insurance companies, six are engaged in P&C insurance while two are life insurers.

The eight companies are: 

Insurer

Capital hike

EGP m

Paidup capital after increase

EGP m

Paidup capital before increase

EGP m

Misr Takaful

30

120

90

Suez Canal Life

20

100

80

Suez Canal P&C

20

190

170

Mohandes Insurance

29

150

121

Mohandes Life

40

100

60

Delta Insurance

130

250

120

Royal Insurance

25

125

100

Egyptian Takaful

45

230

185

Total

339

1265

926

 

Property insurers thus accounted for the lion's share of the total increase in paidup capital. The P&C insurers' share was EGP279m or 82.3% of the total increase, compared to 17.7% for the two life insurance companies with a combined increase of EGP60m.

The Financial Regulatory Authority (FRA), in finalising the new insurance Bill in July, proposes to increase the minimum capital of life and non-life insurers to EGP150m from the existing EGP60m. In reinsurance activity, a minimum limit of EGP1bn is set, compared to EGP60m under the current insurance law. For a company specialised in medical insurance, the minimum capital will be EGP60m. The minimum capital of non-life insurers covering oil or aviation risks will be EGP300m. In direct insurance and reinsurance brokerage business, the minimum capital for each company is raised to EGP5m compared to EGP2m under the current insurance law.

After the increases, some of the eight insurers may inject more capital because they still fall short of the new minimum paidup capital requirement.

There are more than 30 insurance companies operating in Egypt.

 

 

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