Iran’s insurance industry braces for impact of US sanctions
As Iran’s insurance industry awaits the re-imposition of US nuclear-related sanctions, the sector is this time better prepared for external restrictions.
In Iran, the insurance industry is one of the most important sectors of the economy that will be impacted by the US withdrawal from the nuclear deal — indeed, the trade already has been affected. However, it appears that Iran, which experienced a bitter sting as a result of the previous sanctions, is much better prepared for external restrictions this time around.
The Iranian insurance sector is ripe with opportunity as its potential remains largely untapped. Abdolnasser Hemmati, head of the Central Insurance of Iran (CII), says 70% of the country's $3 trillion potential is uncovered. The CII acts as the industry's sole regulator and one of its few local reinsurers. The industry's annual turnover recently surpassed 500 trillion rials ($11.87 billion) for the first time.
That potential prompted dozens of major companies, mostly European ones, to quickly try to find their way back into the country's market after sanctions were lifted in January 2016 thanks to the Joint Comprehensive Plan of Action (JCPOA).
Germany's Munich Re, the biggest reinsurer in the world, in July 2017 signed a contract with Saman Insurance Company, affiliated with private Bank Saman. It became the first foreign reinsurer to start working with Iran again following JCPOA implementation.
