Calls have been made for legislation that would make it mandatory for merchants across Egypt to have P&C insurance.
The calls follow action taken by the Cairo Chamber of Commerce and the Giza Chamber of Commerce which signed a protocol to insure traders among their members against the risks of personal accident such as death, permanent total and partial disability besides cover for their shops against the risks of fire and burglary. The merchants generally lack preventive systems such as fire fighting equipment, reported Al Mal.
Whether insurance companies will readily agree to insure these shops requires the insurers to examine the risks and ask traders to put in place risk prevention and safety measures.
Mr Gamal Shehata, head of production and branches at Saudi Egyptian Insurance House, said that insurers do not merely play the role of paying compensation but they also play an important role in improving risk management, through conducting an inspection of shop premises, determining the degree of risk as well as making recommendations for risk prevention. Inspection experts contribute too to the reduction of risk to neighbouring shops, for example, by recommending measures that would prevent the spread of fire from one shop to another.
Mr Shehata added that insurance for shops is considered microinsurance. He called on insurance companies to educate traders on the importance of safety and security and the rules to be followed in the storage of goods and disposal of garbage.
Dr Khairy Abdel Qader, professor of insurance at Cairo University, said that some commercial districts are crowded and the roads littered with goods, making it difficult for fire trucks and equipment to reach the scene of a fire quickly and easily.
He called on the government to enact legislation to oblige traders to insure their shops and goods against fire, burglary and other perils, in addition to covering public liability risk. He pointed to the need to link the trader's business licence to the purchase of insurance. He said that making insurance compulsory for merchants would ease the burden on the state to give aid to traders in the event of fire or other disasters in commercial areas.