A committee will be formed by the Insurance Federation of Egypt (IFE) with insurance intermediaries to study the needs of the market, especially with the rise in prices of goods and services, which in turn reduces opportunities for savings.
Mr Alaa El Zuheiry, Chairman of the IFE, said that the trade association needs to play an active role in helping brokers and insurance companies to overcome challenges and contribute to growing the insurance market.
He said that low insurance awareness, in addition to low incomes and high prices, are among major obstacles to the increase in insurance business. Currently, most of the business is generated from compulsory lines.
He added that insurance companies do not allocate a special budget to raise public awareness. He stressed that insurers must have the intention to invest in raising awareness, although it is a cost to them.
Mr El-Zuheiry also said that the government's decision to liberalise the exchange rate of the Egyptian pound last November has led to an increase in the book value of insured assets, which in turn has led to an increase in the insured amounts allocated to them, raising the insurance sector's premium rates by around 50%, which was the extent by which the value of the local currency declined on the liberalisation.
A decision to raise interest rates also contributed to the insurance sector achieving investment returns exceeding 12%, he said.