“Egyptian Company for Insurance Brokerage” exits the Market
An insurance source in a major insurance brokerage company, expected the sector to witness bankruptcy of 20 brokerage companies out of the existing 33 companies in the Egyptian insurance market, as the source also recommended the market to witness a merger between those companies as an alternative to the foreseen crash.
The source also declared that he was presented two offers of acquiring two brokerage companies in the Egyptian market, as these companies couldn’t achieve any sales or profits to make them surviving in the market currently, and he added that he did not make any deals of acquisition or offering consultancy to restructure the business management.
The source said that the main reason behind the current crisis witnessed in some brokerage companies; is the opening of insurance brokerage companies without enough knowledge of this business, as they were convinced that the insurance brokerage is similar to stock market brokerage.
25th of January revolution has nothing to do with problems witnessed in some brokerage companies, but the revolution imposed a positive affection on the insurance sector, as the source stated.
Another insurance source of newly operated insurance brokerage company in the Egyptian market stated that, the insurance sector witnesses currently a restructuring process.
The source also mentioned that there is news stating that the “Egyptian Company for Insurance Brokerage” intends to exit the market soon.
To be mentioned that Insurance brokerage companies have started operating in the Egyptian market since 2009 and the “Egyptian Financial Supervisory Authority” issues about 10 licenses annually, as these license permits companies of executing insurance brokerage business, and it is remarkable that the authority is receiving many requests of licenses to start new insurance brokerage businesses.
It was stated to “Amwal Al Ghad” in earlier time by Dr. Adel Mounir – Vice president of Egyptian Financial Supervisory Authority- that the idea limit of brokerage companies ranges from 50 to 60 companies, but the Financial Authority has not issue a decision about this limit yet.
