In a recent study report released by IRC entitled “Coronavirus and Changes in Some Insurance Risks”, it is mentioned that the coronavirus outbreak by triggering changes in underwriting risks, has altered the paid losses and the premiums received, increased operational costs of the insurers, and finally has led to a reduction in companies’ cash balance, according to PRIAO, IRC.

Event cancellation and business closures are the first and foremost outcome of any pandemic such as coronavirus that primarily causes major losses to the property and casualty lines. Nevertheless, due to the lack of event cancellation and business interruption insurance supply in Iran, the Iranian insurance companies have been safe from paying relevant losses in these two lines. Therefore, given the restrictions placed due to the virus outbreak, underwriting risks and consequently the scale of the losses in Iran’s insurance market has generally reduced.

Based on the results reported, it is expected that during the coronavirus outbreak, those life and health insurance lines that are directly related to the public health, without any changes in their risk amount, will only face with changes in the nature of the risk. At the meantime, auto insurances and other insurance lines such as travel, fire, and cargo that directly correspond with the insurers’ activity, have faced with the risk reduction. The changing risk share of each of these groups is proportional with the weight of each group in the insurance industry of the country.

The Persian full text of the research report is available at this link.