The Afghanistan General Directorate of Insurance Affairs (GDIA) has signed a memorandum of understanding with Turkey’s General Directorate of Insurance (GDI) to Assist Afghanistan in developing its insurance sector, an official said.
Mosa Kamawi, the head of Afghanistan Insurance Affairs told Khaama Press that he has signed an MOU with Turkey’s insurance authority on the exchange of information and cooperation in the field of insurance regulation and supervision.
“The MOU signed on January 16 is valid for 3 years aiming to receive technical and advisory assistance from Turkey to help us with sharing information, experience and capacity building’, Kamawi said.
Turkey’s cooperation will also assist Afghanistan with new investment facilities and development of the country’s insurance market, Kamawi added.
This comes as insurance is one of the least developed industries in Afghanistan. Certain lines of insurance which are compulsory anywhere else in the world for the sustainability of the economy and proper risk management, are optional in Afghanistan.
The state insurance firm used to issue ‘third-party auto liability’ insurance coverage on an exclusive basis as the sole insurance provider in Afghanistan before 2008. It was made optional for the vehicle owners following the entrance of private insurance firms into the market.
Currently, there are five insurance companies in Afghanistan including a state-owned firm, they all provide group insurance coverages to cooperate and businesses only.
Afghanistan’s Banking and Telecom industries have had rapid growth in the past 19 years, but insurance remained less developed mainly due to the country’s legislation issues, no law enforcement and lack of state attentions to developing this sector.
Almost all government agencies and state-owned enterprises have never included insurance in their annual budgeting plans.
Travel insurance is a popular coverage issued by travel agents and is obligatory for travelers and visa applicants.