The decision, announced by FRA Chairman Dr. Mohamed Farid, aligns with the newly enacted Unified Insurance Law. The move aims to balance the expansion of insurers' investment activities with the long-term financial stability of the market.
Under Resolution No. 304 of 2025, insurance firms are
mandated to maintain "allocated funds", capital strictly reserved to
meet direct obligations to policyholders, verified by an FRA-registered
actuary.
The new framework introduces several key financial pillars:
Net equity must not fall below the minimum issued capital
requirement (currently 600 million Egyptian pounds. This is calculated after
excluding amounts set aside for investment fund subscriptions or capital in
fund management firms;
Companies must maintain a free fund surplus, capital not
tied to direct liabilities, of at least 10% of their minimum issued capital;
Insurers are required to invest a minimum of 2.5% of their
paid-in capital in open-ended investment funds targeting listed stocks, with a
maximum cap of 20%.
The FRA stated that these updates replace older 2014
regulations to harmonize the sector with the Unified Insurance Law’s modern
oversight standards.
"This decision is part of ongoing efforts to regulate non-banking financial activities while ensuring a balance between growth and market stability," the Authority said.