The Financial Regulatory Authority (FRA) has decided to continue to work with existing regulations until the issuance of implementing rules and decisions backing the new Unified Insurance Law that was enacted earlier this month.
The decision issued by FRA chairman Mohamed Farid was published in the Egyptian Gazette on 10 July, reported Amwal Al-Ghad.
Among the various provisions of the Unified Insurance Law are stipulations for the required minimum capital of life, non-life, and reinsurance companies as well as microinsurance and standalone health insurance companies.
The required minimum capital for insurance companies, both life and property, is increased to EGP250m ($5.2m) from EGP60m previously. The minimum capital of property and liability insurance companies is set at EGP250m and the amount is increased by EGP50m if an insurer engages in oil & gas, aviation, or energy insurance. (Thus, if insurance services in all of these three branches are offered by an insurer, the minimum capital would be EGP400m.) The law sets EGP1bn as the minimum capital for a reinsurance company.
As the new Law had been at the deliberation and drafting stage for several years before its enactment, insurance companies have been gearing up to comply with it. Several insurers have raised their capital to meet the new requirements.
For example, in May 2024, Sarwa Insurance managing director Ahmed Khalifa said that the company planned to raise its paid-up capital to EGP250m in the six months to 31 December 2024 through funds injection by shareholders. Earlier, the insurer had increased its paid-up capital from EGP100m at the end of December to EGP136m through the conversion of retained earnings.
Meanwhile, Unicare chairman and CEO Amr Hamza has said that the company intends to transform itself into a specialised medical insurer. Unicare is a Giza-based health maintenance organisation. Dr Hamza says that work is currently underway to complete the necessary documentation to be submitted to the FRA for approval of a health insurance licence.