The Financial Regulatory Authority (FRA) has clarified the scope of application of the rules for forming the boards of directors of insurance and reinsurance companies and related committees, in light of the inquiries received from a number of companies.
The rules of governance of insurance and reinsurance companies had been issued in 2025 in implementation of the provisions of the Unified Insurance Law.
The Authority confirmed, in a circular issued by Dr Tariq Saif, Vice Chairman of the Authority, that the conditions that must be met in forming the boards of directors and the requirements for forming committees, will begin to be applied as of the first upcoming elections for the company’s board of directors.
According to the circular, these include procedures for meetings, preparing minutes, submitting reports, and the powers of committees after their formation, as operational provisions.
One-year deadline for other governance provisions
The Authority stressed that all other provisions that do not specifically relate to the conditions for forming the Board of Directors or the requirements for forming committees must comply with the rules within one year, in addition to amending the Articles of Association when necessary.
The FRA had issued Resolution No. 200 of 2025, which included the first binding governance rules for insurance and reinsurance companies, to strengthen the regulatory framework for the insurance sector in Egypt. This resolution obliges companies to prepare an internal governance regulation that includes a charter for the work of the board of directors and its committees, and detailed policies and procedures for internal control, compliance, risks, investment, underwriting, claims settlement, reinsurance, credit, succession planning, asset and liability management, internal audit, a code of ethics and professional conduct, proportionality and appropriateness, whistleblowing, information security, non-conflict of interest, disclosure and transparency, protection of company assets, rewards and benefits, information technology and digital transformation, environmental, social and governance practices related to sustainability and the effects of climate change, and combating money laundering and terrorist financing.
Board of Directors
The resolution defines the role of the company’s board of directors as the dominant authority over the company’s affairs. This includes setting strategic objectives, supervising committees and executive management, ensuring the effectiveness of internal policies, establishing compliance mechanisms, early warning systems, training plans for the board and employees, protecting data security and integrity, and overseeing disclosure and transparency.
It must be formed by an appropriate number of members (not less than five), the majority of whom must be non-executive, with at least two independent members among them, and it must include female representation. The positions of Chairman of the Board and Managing Director/CEO may not be combined.