Insurance Committee

Globalization of the national insurance sector - May 2001

Kheiry Selim, head of the Egyptian Insurance Supervisory Authority, spoke at the Marriott on May 2 about the impact of globalization on Egypt’s insurance industry.

Selim said that emerging markets are always criticized because the insurance sector does not contribute significantly to GDP. With the latest moves by Egypt’s government to encourage development of the insurance sector, however, multinational insurance companies are seeking to penetrate the market.

"Where are we in the insurance market? Where are we if we compare ourselves in terms of globalization?" he asked. Globalization has brought about a need to liberalize tariffs and price structures and to abolish compulsory quotas that have been levied on insurance companies.

Several steps are being taken to liberalize the market. One is for the public insurance firms to get rid of their shares in poorly performing companies. With the promulgation of new insurance laws in 1995 and 1998, cumbersome tariff structures have been removed, as were barriers to the participation of foreign capital in the market. The result is that this capital has been invested in the national economy.

However, insurance companies still need to be regulated. "These are the policies that were adopted, but we should have restrictions in order to guarantee the stability of the market," Selim said.

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