Egypt – The insurance sector seeks Arab currencies for reinsurance
Thursday, 10 13 2016, Category: Insurance and Reinsurance, Country: Egypt
Although Arab ReTakaful companies are allowing settlements of Egyptian Takaful companies in the currency of the country of the ReTakaful company such as the settlement of amounts to “Saudi Re” in Saudi Riyal instead of the US Dollar, the insurance companies find it difficult to secure Arab currencies at banks.
Reinsurance manager at Takaful insurance companies confirmed that the Egyptian economy is going through a currency shortage that does not only affect the US Dollar as banks and the central bank seek to retain their reserves from different currencies for the longest possible period inside the country. Moreover, banks do not have large amounts of Arab currencies as they are not hard currencies compared to the US Dollar or the Euro.
And they indicated that Arab ReTakaful companies need the US Dollar instead of the local currency since they use it in “retrocession” operations in order to settle amounts due to foreign reinsurers.
Source: Al Mal News