Egypt's Financial Regulatory Authority updates credit insurance rules

The Financial Regulatory Authority (FRA) in Egypt has issued a comprehensive update to the regulations governing underwriting and pricing for credit and guarantee insurance policies. Issued by FRA Chairman Dr. Islam Azzam, Decision No. 3132 of 2026 aims to enhance underwriting, pricing, reinsurance, and risk management policies to ensure financial stability and discipline within the insurance sector.

The new regulations apply to property and liability insurance companies licensed to provide credit and guarantee insurance, excluding domestic or export commercial credit and guarantees. A key provision mandates that the insured party or the credit grantor must bear no less than 25% of the outstanding balance of the insured financing or credit facility at the time of the insured risk event. This portion cannot be insured, redistributed, or transferred to third parties.

Furthermore, the decision prohibits side agreements that modify coverage scope, reduce mandatory retention levels, or alter compensation terms in ways that contradict approved insurance policies. Companies are also required to implement written underwriting policies approved by their boards of directors, which must include risk acceptance criteria, creditworthiness assessment methodologies, and exposure limits.