EFSA approves guaranteed repayment little funds document

Egyptian Financial Supervisory Authority approves guaranteed-repayment-little-funds document, to be executed in the Egyptian market in the upcoming period.

The document guarantees the repayment of funds by the insured “the borrower” to the insuree “the lender”, in accordance with the conditions agreed upon by the two parties. The document’s regulations and issuing systems obligate that the lender shall pay the total insurance value as the insurance begins as well as he will be committed to pay life insurance for the insurance company, which equals the value of the debt as long as the debt is not repaid, and he will pay also a supplementary insurance on the funded-project, which equals its market value.

These documents shall be repaid and valid during the covered insurance period. Besides, it shall be assured that the agent does not borrow more than one loan from the insuree or from any subsequent branch in the same time.

The document also includes offering a non-obligatory, advisory price for the insurance companies, with a 2% rate, so as be able to cover insolvency danger for any reason including death. About insolvency, the document determines that it is being in default for 3 successive installments, in accordance with the Central Bank’s instructions about the insolvency period. The little funding is determined to be EGP 500 thousand.

Source: Amwal Alghad