Foreign insurers taking cautious look at Iran after nuclear deal
By Carolyn Cohn and Bernardo Vizcaino
LONDON/SYDNEY (Reuters) - Western and Middle East insurance specialists see Iran as an appealing $8 billion (£5 billion) market in the wake of its nuclear deal with world powers, though uncertainty over when sanctions on Tehran will be lifted means they are treating the country with caution.
Eight out of 11 insurance and reinsurance specialists who responded to questions emailed by Reuters this week said Iran was an attractive or very attractive market, especially in the marine and energy sectors. Responses were on an anonymous basis due to the sensitivity of the issue.
While several said they expected to have entered the Iranian market by the end of 2016, others said it was hard to say due to ongoing concerns about how and when sanctions might be repealed.
Under the accord reached in Vienna on July 14, Iran will be subject to longer-term curbs on its nuclear program in return for the removal of U.S., U.N. and European Union sanctions.
This would open a market of $8 billion in premiums to global firms looking to underwrite critical export-related risks while promising sorely-needed scale for regional players.
The deal has still to be approved by the U.S. Congress, where hawkish Republican foes of President Barack Obama oppose it, and also faces objections from influential conservative hardliners in Iran.
However, Iran, the Middle East and North Africa region's second largest economy, with a large oil and gas sector and a young educated population, is already drawing attention.
"The main economic boost for Iran will come in 2016, although domestic consumer and investor confidence will receive a short-term impetus," said Ludovic Subran, chief economist at credit insurer Euler Hermes. Continued...