Page 51 - IRANRptNov20

Iranian insurers call for government help as coronavirus payout pressure mounts
said he is worried it will not be high enough to act as a deterrent. There is also concern that there will be inconsistent application of the face masks fines policy, given the different layers of bureaucracy.
The Iranian Insurers’ Organisation—an industry lobby group—has requested financial support from Iran’s government as it contends with the country’s growing death toll from the coronavirus (COVID-19) pandemic, according to ​Donyaye Eqtesad.​
Insurance companies, call centres and secondary agents in offices around the country suspended much of their work given closure notices issued by the government as the outbreak worsened, but following their return to operation they have found themselves buckling under the weight of applications and payouts.
Some 400,000 people are employed in the insurance sector in Iran, a country of 83mn. The industry is now facing a perfect storm of policy auto-renewals together with payouts, despite not being able to raise the base prices of policies.
The medical and life insurance segments have reportedly taken the biggest hits in recent days, with huge payouts becoming due.
Also, unemployment benefit, which is backed by insurance, has skyrocketed in recent weeks, with some 600,000 people officially laid off as a consequence of the economic effects of the pandemic in Iran. Earlier, as part of preparations to deal with the outbreak, insurance companies were told by Central Insurance of Iran to recapitalise and meet new minimum liquidity rules ahead of the impending payout surge.
The government in 2017 set IRR2.5 trillion ($65.18mn at the official exchange rate) as the minimum capital requirement for starting a reinsurance firm and IRR1tn as the requirement for starting an insurance firm.
9.1.8​ Agricultural sector news
Scarce feed supplies, high prices reportedly push thousands of Iranian poultry farmers out of operation
Scarce supplies and high prices on Iran’s feed market have reportedly pushed thousands of poultry farmers out of operation during the past months.
The country’s government is failing to distribute enough feed among poultry farms at a guaranteed price, Habibollah Asad-Nejad, deputy head of Iran’s Chicken Producers Association, told IRIB, as cited by Poultry World on September 16.
The Iranian authorities provide a special government exchange rate for imported feedstuffs and in recent years the government distributed feed at markedly lower prices than those on the open market in order to avoid chicken meat market price fluctuations. However in the past few months, demand for feed rose to a level higher than the government could meet. On the open market, poultry farms have to pay Iranian rial (IRR) 120,000 ($0.5 at the free market exchange rate) per kg of poultry feed, which is three times more expensive than the government price, Asad-Nejad was cited as saying, adding that since May the government has only been able to supply an estimated 50% of poultry farms’ demand for feed.
The feed supply problems have already driven 7,000 poultry farms out of operation and prompted numerous hatcheries to cut down on production, according to local reports.
The supply disruptions have been caused by the ongoing downward rally of the Iranian currency. The rial has lost around half its value against the dollar in
51​ IRAN Country Report November 2020 www.intellinews.com