Hesham Ramadan: Life insurance holds a 52% share of sector premiums during the last fiscal year – Source: Al-Bosla Newspaper – May 9, 2023
By: Walid El-Sayed
Dr. Hesham Ramadan, Managing Director of Suez Canal Life Insurance Company, stated that the life insurance sector has witnessed high growth rates over the past years, capturing 52% of total sector premiums during the fiscal year 2022, compared to 40% during the fiscal year 2018.
Ramadan explained during his speech at the Arab Actuarial Conference 2023 that life insurance premiums amounted to around EGP 12 billion in the fiscal year 2018 and increased to EGP 29 billion in the fiscal year 2022.
He confirmed that the insurance sector in the local market has achieved an accumulated growth rate of 90% over the past five years, with an average annual growth rate of 19%. He added that private insurance fund subscriptions amount to around EGP 16 billion in the market, meaning that if added to life insurance activity – as is the case in some Arab markets – the sector’s total premiums would double.
He pointed out that despite the growth in life insurance premiums in the market, the individual spending rate on life insurance policies remains very low compared to other markets, reaching only about USD 9 in the Egyptian market.
He noted that there are several factors expected to contribute to the growth of life insurance activity in the market in the coming period, foremost among them being the implementation of the first Egyptian actuarial table, which will help develop life insurance products and improve policy pricing.
He added that another factor expected to drive growth is the Unified Insurance Law currently being discussed in Parliament. This law will allow the establishment of specialized companies in microinsurance — both life and property — while also providing a legislative framework supporting life insurance companies’ use of technology in marketing, selling, and issuing policies, in parallel with the provisions of the Financial Technology Regulation Law.
Ramadan explained that the Financial Regulatory Authority (FRA) is expected to issue new legislations aimed at developing the life insurance sector in the market, including completing the legal framework required to use technology in marketing and issuing policies, as well as regulations for advancing the actuarial profession.
Ramadan also reviewed the development of the legislative environment for the Egyptian insurance sector since the issuance of Law No. 10 of 1981, noting that in 1995, the entry of foreign capital was allowed to establish companies in the Egyptian market. This contributed to the growth of the life insurance sector, as most of the companies established under this system were engaged in life insurance activities.