The Board of Directors of the Financial Regulatory Authority (FRA), chaired by Islam Azzam, has issued a decision requiring insurance companies to comply with a set of regulatory standards governing reinsurance operations. The move comes as part of the implementation framework of the Unified Insurance Law No.
155 of 2024 and aims to enhance risk management efficiency within Egypt’s insurance sector. In a statement issued on Thursday, June 25, 2026, the FRA said that Decision No. 98 of 2026, recently published in the Egyptian Gazette, introduces several obligations related to the management of reinsurance activities.
Reinsurance is considered one of the primary tools for transferring and distributing risks, helping to strengthen insurers’ financial solvency, reduce the risk of financial distress, enhance protection for policyholders and beneficiaries, and ensure the sustainability and growth of the insurance industry.
FRA Chairman Islam Azzam said the decision reflects the authority’s strong focus on developing the insurance sector and keeping pace with global developments, best practices, and recommendations issued by the International Association of Insurance Supervisors (IAIS) to improve reinsurance efficiency and enhance the sector’s overall investment attractiveness.
He added that the standards established by the FRA represent key technical tools for risk management and require insurers to develop a comprehensive reinsurance policy. Such policies must explain the rationale for using reinsurance as a risk-transfer mechanism and assess its economic benefits for the company.
They should also address the company's risk appetite, portfolio diversification, ability to bear credit risks arising from dealings with reinsurers, target reinsurance markets, criteria for selecting reinsurers, circumstances under which external parties such as reinsurance brokers or managing general agents may be engaged, the standards for their selection, and procedures for managing liquidity risks associated with reinsurance contracts.
Azzam explained that all insurance companies are required to submit their reinsurance policies to the FRA, notify the authority of any amendments, and provide details of their reinsurance programs within a maximum of two months from the date of preparation or renewal.
Companies must also ensure the effective implementation of their policies and review them regularly. The decision further requires insurers to establish reinsurance programs that are commensurate with the size of their business operations and capital bases, while clearly defining risk-retention limits and the maximum financial obligations they can assume.
This is intended to balance business expansion with financial stability. To strengthen companies’ ability to withstand crises and exceptional circumstances, the decision mandates the adoption of comprehensive reinsurance risk-management procedures. These include periodic risk reviews, contingency plans for dealing with the default or insolvency of reinsurers, stress testing, and scenario analyses to assess the potential impact of risks on companies’ financial positions and capital requirements.
Insurers are also required to identify, monitor, assess, and control risks and establish appropriate contingency measures. The decision also introduces several measures aimed at enhancing transparency and corporate governance.