by Marwa Yahya
CAIRO, July 8 (Xinhua) -- Egypt's insurance industry is impacted by COVID-19, though most of the claims cover many diseases including the pandemic.
"The novel coronavirus has appeared in Egypt since mid-February, which means the insurance companies have worked the whole second quarter of 2020 amid the virus concerns," said Alaa al-Zoheiry, chairman of the Insurance Federation of Egypt.
Although some Egyptian insurance companies claim the coverage of the pandemics such as coronavirus, the rate of signing insurance documents since February has declined by 10 to 15 percent compared to the same period in the previous year.
Driven by the difficult living conditions that the citizens have been experiencing lately, "the rate of paying the installments of the claims, which have been signed before the outbreak of the virus, has also been impacted," he explained.
Seeking life insurance relies on the ability to save money, al-Zoheiry pointed out, noting that in the time of crisis, people would give the priority to ensure food and medicine, and buying insurance certificate would come last in the list of priorities.
"The insurance industry is the real mirror of the economy and an international economic stagnation is predicted while the world economies are suffering difficult times," he said.
Insurers carefully consider the potential impact of the virus on their short-term and long-term financial outlooks, he said, adding that the claims will likely be limited to certain classes of business.
"People have more tendency to save their money in the bank and are reluctant to pay for insurance or any sort of investment because they fear that they might lose their jobs and couldn't fulfill their dues," he added.
According to the Insurance Information Institute's first quarter "Global macro outlook," the COVID-19's impact on global growth and the insurance industry is likely deeper than the current consensus and could last into the third quarter of 2020 and beyond.
Mohamed Abdel Raziq, a consultant in Tharwa Egypt Company, agreed with the insurance expert, saying that COVID-19 has hit hard the insurance sector revenues, due to the decline of the financial resources of the clients.
He said that "some companies have issued insurance policies on COVID-19, by which the families of the insured will receive full value of the amount if the father dies of the pandemic."
He added that this is the first time when the insurance companies have witnessed such decline even in times of war.
COVID-19 could also disrupt service. Agents and brokers likely face some risk management and logistical challenges, since many have to work from home.
"Face-to-face meetings with clients may have to be avoided until the risk of exposure passes," he said.
Egypt reported 1,057 new coronavirus cases on Tuesday, bringing the total infections to 77,279, with 3,489 deaths according to the health ministry update on Tuesday.
But Abdel Raziq said that the digitizing process that appeared with the adoption of the anti-virus precautionary measures will contribute to creating good opportunities for the insurance companies in the short term.
However, Josef Tawfiq, chairman of Cairo-branch of Alico Metlife, said that his company made a good number of deals in the past two months.
"People have realized the importance of life insurance as they assumed that the crisis of the virus might last longer," he added. Enditem
