Egypt: Regulator issues insurance pricing rules
Source: Middle East Insurance Review | Oct 2023
The Financial Regulatory Authority (FRA) has announced requirements that insurance companies and cooperative insurance societies operating in the Egyptian market must meet in pricing insurance policies to ensure fair competition and to protect policyholders’ interests.
The decision requires insurers to consider sound technical principles when pricing insurance policies. Insurers are also told not to lower their premiums to an extent that would affect their underwriting results and financial positions negatively, according to local media reports.
Under the new regulation, insurance companies and cooperative insurance societies must prepare a study that includes the technical and actuarial bases for pricing insurance products.
Provided that the study is approved by the actuary and the competent authority of the insurer, it is sufficient to provide, in property and liability insurance, the technical basis for the pricing of products in the ship hull, aviation, oil and gas and engineering branches.
The regulation also stipulates the deadline for insurers to submit reports on their study to the FRA.
Insurers must review their pricing principles and policies annually, updating the study submitted to the regulator in light of the actual results and submitting proposals for amendment if necessary.
FRA chairman Mohamed Farid said that the new regulation is part of the FRA’s continuous efforts to ensure discipline in the pricing process for various insurance products. He said that the FRA pays great attention to the insurance industry because of the sector’s major role in supporting the national economy by mobilising savings. M