A Chapter From - Regional Practical Guidance - Insurance - Egypt
Transport & Insurance Focus
Egypt’s insurance sector is governed by a comprehensive legal and regulatory regime under the Financial Regulatory Authority, which oversees both conventional and Islamic (Takaful) insurance.
Law Update: Issue 376 – Transport & Insurance
Anand SinghSenior Counsel, Transport & Insurance
Melody HuangAssociate,Transport & Insurance, China Group
Nazly SadikParalegal,Transport & Insurance
This article is part of a regional regulatory guide for the insurance sector and sets out sample questions and responses focused on Egypt. It explores the country's insurance regulatory framework under the supervision of the Financial Regulatory Authority (FRA), which has exclusive jurisdiction over all insurance, reinsurance, Takaful, and insurance-related professions. The FRA’s mandate extends across licensing, solvency monitoring, Shariah compliance for Islamic insurance, and consumer protection. The responses below provide a comprehensive overview of the legal and operational requirements in Egypt, covering reinsurance rules, intermediary licensing, outsourcing limitations, capital requirements, foreign branch regulation, and dispute resolution procedures. This guide serves as a practical resource for market entrants and stakeholders navigating the Egyptian insurance landscape.
What is the name of the main regulator(s) governing insurance in this jurisdiction? The Financial Regulatory Authority (FRA) is the primary regulator overseeing the insurance and reinsurance sector in Egypt. The FRA has exclusive authority to supervise and monitor all insurance-related activities in the country, ensuring compliance with relevant laws and regulations.
Is there a different regulator covering Islamic insurance (Takaful) in this jurisdiction?No, there is no separate regulator for Islamic insurance (Takaful) in Egypt. The FRA regulates Takaful and Re-Takaful insurance in Egypt in accordance with specialized supervisory rules and Shariah compliance standards issued by its Board of Directors. The law mandates that Takaful and Re-Takaful companies operate under Shariah Supervisory Committees, which ensure that their activities comply with Islamic financial principles (Article 192-193).
Is there a different regulator for reinsurance?No, reinsurance in Egypt is also regulated by the FRA. The FRA establishes standards and controls governing reinsurance activities in Egypt, including local and international reinsurance agreements (Article 181). Reinsurance transactions must comply with FRA regulations, and local insurance companies must prioritize domestic reinsurance companies unless FRA permits otherwise (Article 143).
What are the main areas which they regulate?The FRA regulates all insurance, reinsurance, and insurance-related professions in Egypt. The key areas of regulation include:
Licensing and Registration:
Licensing of insurance, reinsurance, Takaful, microinsurance, and health insurance companies.
Registration of insurance intermediaries, brokers, actuaries, loss adjusters, and insurance consultants (Articles 139-146).
Approval of insurance policy terms, conditions, and pricing (Article 209).
Supervision and Financial Solvency:
Setting minimum capital requirements for insurance and reinsurance companies (Article 162-163).
Regulating technical reserves and solvency ratios to ensure insurers can meet their obligations (Articles 174-175).
Ensuring the adequacy of reinsurance arrangements (Article 181).
Risk-based supervision and stress testing for financial stability (Article 182).
Corporate Governance and Consumer Protection:
Enforcing corporate governance standards for insurance companies (Article 172).
Protecting policyholders’ rights and handling complaints (Article 151.11).
Regulating insurance marketing, digital insurance platforms, and fraud prevention (Article 199-200).
Takaful (Islamic Insurance):
Establishing Shariah compliance standards for Takaful and Re-Takaful insurance (Articles 192-197).
Overseeing the management of the Takaful Surplus and Qard Hassan (interest-free loans) (Articles 194-195).
Intermediary Regulation:
Registration and regulation of insurance brokers, agents, and consultants (Articles 139-146).
Anti-Money Laundering & Compliance:
Implementing anti-money laundering (AML) and counter-terrorism financing (CFT) regulations for insurance companies (Article 151.6).
Does Egypt have any other independent jurisdiction that function separate from the onshore jurisdiction?Egypt does not have a separate offshore or free-zone regulator for insurance or reinsurance; all insurance and reinsurance activities fall under the jurisdiction of the Financial Regulatory Authority (FRA). However, free-zone insurance companies established under the Investment Law No. 72 of 2017 are allowed to operate under special licensing conditions, but they remain under the FRA’s supervision and must comply with specific articles of the Unified Insurance Law (Article 5). If a free-zone insurance company wishes to conduct business outside the free zone in Egypt, it must adjust its status to fully comply with the FRA’s onshore insurance regulations.
The main difference between onshore and free-zone insurance companies lies in the scope of regulation and business operations. Onshore insurance companies are fully regulated under the Unified Insurance Law and can operate freely within Egypt, whereas free-zone insurance companies are exempt from some legal provisions but must adhere to FRA's licensing rules. Free-zone insurers cannot provide insurance services to residents in Egypt unless they obtain FRA approval and comply with onshore requirements. Additionally, capital and solvency requirements may vary between onshore and free-zone entities.
Are there any restrictions on the way reinsurance operates in this jurisdiction?Yes, the FRA imposes specific restrictions on reinsurance operations, including:
Preference for local reinsurance:
Egyptian insurance companies must first seek reinsurance from domestic companies before placing risks with foreign reinsurers (Article 143).
If no domestic reinsurance option is available, companies must seek FRA approval for international reinsurance placements.
Reinsurance brokers regulation:
Only legal entities can engage in reinsurance brokerage (individuals are not allowed) (Article 139-141).
Brokers must be registered with the FRA and comply with minimum capital and governance requirements (Article 142).
Takaful Reinsurance (Re-Takaful) Restrictions:
Takaful insurance companies must prioritize Re-Takaful providers when seeking reinsurance coverage (Article 192).
If Shariah-compliant Re-Takaful coverage is unavailable, the FRA may approve conventional reinsurance, provided that the agreement is endorsed by the Shariah Supervisory Committee (Article 193).
Are there limits or requirements for outsourcing operations to third-party vendors, particularly for critical functions?Under Egypt’s Unified Insurance Law, there are specific limits and requirements for outsourcing operations to third-party vendors, particularly for critical functions. Insurance and reinsurance companies must comply with the governance, internal control, and risk management standards set by the FRA (Article 170). Companies must ensure that outsourcing arrangements do not compromise financial solvency, policyholder protection, or regulatory compliance. The FRA has the authority to issue specific rules and standards governing outsourcing agreements, including third-party service providers handling critical insurance operations such as claims management, underwriting, actuarial services, and IT infrastructure. Additionally, healthcare programs management companies and takaful insurance firms must also comply with specific outsourcing conditions to ensure service continuity and consumer protection (Articles 190 and 192).
How are foreign branches regulated in Egypt?Foreign branches in Egypt are regulated under Article 160 of the Unified Insurance Law, which allows Egyptian insurance companies to open branches or establish subsidiaries abroad, provided they comply with FRA licensing requirements. The FRA monitors foreign branches to ensure that they adhere to Egyptian regulatory standards while conducting international operations. Additionally, foreign insurers cannot operate directly in Egypt without an FRA license (Article 152), but they can set up representation offices (Article 123). These offices cannot underwrite risks locally and are limited to market research, client relations, and coordination with their headquarters. Foreign insurers seeking to offer reinsurance services in Egypt must register with the FRA (Article 143) and comply with reinsurance placement rules, which require priority to be given to domestic reinsurers before seeking offshore coverage.
What are capital requirements in Egypt? Under Article 162 of the Unified Insurance Law, the minimum issued and paid-up capital for insurance and reinsurance companies in Egypt is:
EGP 250 million for life insurance and property & liability insurance companies.
EGP 1 billion for reinsurance companies.
EGP 30 million for microinsurance companies.
Additionally, companies must deposit a minimum reserve of EGP 500,000 per insurance category in a bank registered with the Central Bank of Egypt (CBE).
Is there a statute of limitations on insurance claims If so, what is it?Yes, insurance claims are subject to a statute of limitations under Egyptian law:
General insurance claims: 3 years from the date the insured became aware of the loss.
Life and long-term insurance claims: 5 years.
Third-party liability insurance claims: 3 years from the date the injured party became aware of the damage.
Subrogation claims by insurers against third parties: 2 years from the date of claim payment.
If fraud, concealment, or bad faith is involved, the limitation period may be extended.
What mechanism do insurance policies usually provide for resolution of coverage disputes?Most insurance policies in Egypt include dispute resolution clauses, which may provide for:
Mediation: A voluntary process to resolve disputes outside court.
Arbitration: Often preferred for commercial insurance contracts, ensuring faster resolution.
Litigation: If no arbitration clause exists, disputes are taken to Egyptian courts.
Regulatory Grievance Committee: If related to insurance regulatory matters, disputes may be referred to the FRA’s Grievance Committee before litigation.
Takaful (Islamic insurance) policies may require disputes to be reviewed by a Shariah Supervisory Committee before arbitration or litigation (Article 193).
Egypt’s insurance sector is governed by a comprehensive legal and regulatory regime under the Financial Regulatory Authority, which oversees both conventional and Islamic (Takaful) insurance. The FRA’s role includes licensing, solvency enforcement, intermediary supervision, and consumer protection—all designed to strengthen the market and encourage responsible growth. With increasing attention on capital adequacy, Shariah compliance, and reinsurance localisation, operating in the Egyptian market requires a clear understanding of the evolving regulatory environment.
Our insurance lawyers in Egypt advise local and international clients on all aspects of insurance and reinsurance regulation, including licensing, compliance, corporate structuring, and dispute resolution. Whether you are looking to establish a presence, navigate outsourcing rules, or manage cross-border reinsurance placements, our team can support your legal and strategic needs. Please feel free to reach out for tailored legal advice on insurance-related matters in Egypt.
For further information,please contact Anand Singh, Melody Huang and Nazly Sadik.
Published in April 2025
