The Egyptian Financial Services Authority’s board of directors has approved a proposal to amend the Economic Courts Law to give it jurisdiction over insurance disputes and litigation.

The board agreed to this in a meeting about amendments to Egypt's bancassurance rules. If its proposals go through, these rules will allow any bank to sign contracts with insurance companies and takaful companies at the same time. Sherif Samy, EFSA's chairman, said that the board was introducing a new general department to oversee reinsurance and had approved its terms of reference.

Samy revealed that EFSA found it necessary to consider the inclusion of disputes and claims arising from the application of Law No. 10 of 1981 for Insurance Supervision and Control under the laws covered by the jurisdiction of the Economic Courts Law No. 20 of  2008 so as to ensure a faster progression of cases, for both the policyholders and insurance companies.

He added that although article (4) of the Economic Courts Law stated that first instance Circuit and Court of Appeal Circuit have a jurisdiction over crimes stated in number of laws, including the law of 1981, article (6) of the same law did not include the jurisdiction of the Economic Courts over insurance disputes and non-criminal cases in insurance and compensation claims or disputes among insurers.

On the other hand, with regard to bancassurance and in the light of the central bank’s approval to amend the rules that govern the signing of contracts with banks, Samy pointed out that a bank can sign a contract with an insurance company that operates in both property insurance and life insurance. The bank can sign contracts with four companies - one of each kind - according to what was approved by the central bank at EFSA’s request. The existing rules allow contracting with two insurance companies only, where one is a property insurance company and other is life insurance company.

The new department will prepare a list of reinsurers in the Egyptian market accredited by to the world's biggest rating agencies. It will study reinsurance policies and the end-results of such policies by examining retention capacity, rates of losses, reinsurance commission, reinsurance surpluses and deficits and various risks. The new department will approve the establishment of new reinsurance companies and it will supervise and inspect these companies.