Two firms from Italy and Germany are negotiating to buy the shares of Iranian insurance companies, the head of Central Insurance of Iran announced.

“I cannot mention the names of companies since they might not reach an agreement with the Iranian side, but the negotiations with them are continuing,” Abdolnasser Hemmati was also quoted as saying by IBENA.

The CII chief noted that the purchase of shares of an Iranian company by a foreign firm will comprise foreign investment in the Iranian insurance industry.

“We have negotiated with 10 top international insurance companies for further cooperation while they have announced their readiness to start making investments in Iran. Hence, negotiations with Iranian insurance companies have been planned with them in the foreseeable future,” he added.

Hemmati further said the insurance penetration rate in Iran has increased 4.5 times the pace of the country’s GDP growth, which indicates insurance industry’s high potentials for attracting foreign investments.

The official mentioned the contract between Iran’s Saman Insurance Company and the world’s largest reinsurance company Munich Re, which became the first foreign reinsurer to start working with Iran after the lifting of international sanctions in January 2016.

“We have also managed to sign a deal with a French reinsurer to cover our catastrophic losses that are impossible to handle by a single country,” he added.

The deal was signed between Iran’s Mellat Insurance, affiliated with Bank Mellat, and France’s SCOR SE based on which SCOR will cover all the catastrophic losses of Mellat’s policies in fire insurance, natural disasters, loss of profit and engineering insurance up to a ceiling of €200 million.

Hemmati noted that Iran has more than $3 trillion worth of insurable capital, but unfortunately more than 70% of them are uninsured.

“Most of the residential units in the country are not insured while out of 25 million cars in the country, only 3 million of them have body insurance policy,” he added.

Commenting on recent negotiations with European countries like the UK, France, Germany, Italy and Switzerland, Hemmati underlined that good insurance relations have been established with them and he intends “to gradually expand ties with foreign reinsurers to cover catastrophic losses”.