FRA issues new financial solvency standards for insurance companies
Updated 8/5/2025 12:59:00 PM
Arab Finance: The board of the Financial Regulatory Authority (FRA), headed by Mohamed Farid, issued Decision No. (148) of 2025 regarding new standards for financial solvency required at insurance and reinsurance companies, according to a statement.
This comes within the framework of the FRA’s objectives to enhance proactive oversight and boost risk management efficiency.
The decision aims to establish a modern regulatory framework to ensure that companies maintain sufficient capital to cover their future obligations, supporting business growth and protecting policy beneficiaries.
It called on property and liability insurance companies to calculate the solvency margin using two methodologies. the first is 20% of net premiums until the end of December 2027, and the second is based on net deductible claims.
Meanwhile, companies are required to apply the higher of the two methods, taking into account Egyptian Accounting Standard No. 50, particularly in high-risk activities.
As for personal and mutual fund insurance companies, the margin is calculated based on the insurance capital in addition to technical provisions, deducting net liabilities after the impact of reinsurance.
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