In continuation of its double standard policy in dealing with insurance businesses, Central Insurance blocked the access of online insurance companies (insurtechs) to the insurance inquiry service in the past days.
According to Iran digital economy annotation, the reason for this decision was that these companies did not accept the new inquiry fee rate. This is while the insurance inquiry is done free of charge on the Central Insurance website, but this institution has decided to charge a significant fee for the inquiries from insurtechs.
Access to central insurance systems with hard work
The Supreme Council of Insurance on January 2023 issued the “Regulations on the establishment and operation of insurance technology companies” for implementation. In Article 18 of this regulation, it was clearly stated that “Central Insurance is obliged to provide the access of the insurance technology companies to the information systems related to their activities by complying with the national data and information management law and protecting the privacy of individuals.”
Central Insurance has provided this access through its subsidiary company, “Fanhab”, which is conditional on receiving a fee. This institution has also increased the cost of inquiry about 40 times; A cost that insurance startups still consider heavy.
CEO of Azki: Central Insurance has no flexibility to negotiate
Hamid Valipouri, the CEO of Azki: central Insurance announced to the entire insurance industry about 2 years ago that insurance startups should only receive any service from this institution and no company has the right to provide these services to startups. slow While insurance companies provide these services to the rest of their offline sales network.
CEO of Azki explains about the anti-competitive procedure of Central Insurance: “In this regard, Central Insurance defined a company as its subsidiary and said that insurance startups should receive their desired services only from this company. This company has an exclusive nature and in this space it is the only provider of services needed by insurance startups and operates without competitors.
He says that startups have repeatedly warned Central Insurance that “these conditions create a monopoly in this space and destroy the commercial balance and the possibility of negotiation between the two parties; Because one party has a monopoly and can make any decision, and the other party is forced to confirm.”
However, Central Insurance did not pay attention to this warning. Valipouri says that by increasing the inquiry fee more than 50 times compared to the last 2 years, the inquiry fee has been increased from 50 Tomans to 2,500 Tomans and finally, they have announced the final amount of 500 Tomans.
The CEO of Azki also explains about the impossibility of paying the same amount: “Inquiries that happen on our websites do not necessarily lead to purchases. Many people on our websites only receive inquiries about their insurance records. Right now, Azki’s website is more visited than the website of Central Insurance or the website of insurance companies; Not for the operation of buying insurance, but because it is easier for people to receive inquiries in this space. “While this inquiry is provided on the Central Insurance website for free, the Central Insurance takes money from us to provide this service.”
Valipouri says that the Central Insurance finally did not come to an agreement on the price with the startups and since last week “Fanhab” company has cut off the access of the startups to this service.
CEO of Azki emphasizes about the attitude of Central Insurance: “Although we do not completely agree with the nature of the presence of a monopoly company from Central Insurance, but in order to advance our work, we entered into negotiations in this space so that we can get both the opinion of friends and the opinion of to provide for ourselves, but practically, the central insurance has not given any flexibility.”
CEO of BimehBazaar: Monopoly and innovation do not go together
“Mohammadreza Farahi”, the CEO of “BemehBazaar”, considers this issue to be rooted and old and believes that monopoly and innovation cannot be combined together, and when a group reaches a reliable and permanent source of income by creating a monopoly, it no longer needs to innovate.
Farahi says: “Relationships between 2 private companies, i.e. insurance startups and Fanhab (which is apparently private) should be based on win-win rules, but monopoly destroys this relationship and by eliminating balanced and logical contracts, only one of the parties has the power to negotiate.
He criticizes the management approach of Central Insurance and says: “The shareholders of Fanhab are Central Insurance and its subsidiaries. On the other hand, the ownership and management of this collection are separate from each other and the managers of the company do not have a direct interest in the company. They are appointed by the central bank; Therefore, they have a short-term view. With the change of governments, these people also change, and even exclusive policies are not stable and constantly change. “Fanhab has had 3 CEOs in the last 3 years.”
The CEO of BimehBazaar states that in this situation, it is not possible to negotiate either the price or the terms of the contract, and he sees the 50-fold increase in the inquiry fee as a sign of this compared to the last 2 years.
CEO of Bimeh.com: The issue is not only the prices; The quality of service is also low
Bahareh Sharifioun, the CEO of Bimeh.com, also considers the exclusivity of providing these services to be the biggest problem of this process and says: “This incident has caused us to face the threat of service interruption and we have no other option and we have to submit to prices that They are neither expert, nor economic, and they cannot match our business.”
Sharifioun says that prominent businesses in this field have “went the extra mile” in the negotiations with Fanhab, but despite the expert reviews and the various proposals of businesses to the Central Insurance, no agreement has been reached. He believes that in addition to the insurtech industry and businesses, these restrictions will also be burdensome for users.
The CEO of Bimeh.com considers de-monopoly as one of the solutions to this problem and says: “Reputable companies should be in charge of providing services and there should be no monopoly so that businesses can interact with any company they want; Not that a sovereign institution is in charge and cannot make a decision about it.
Sharifioun reminds that it is not only the issue of prices and the quality of the services provided by these businesses is also not very favorable. “Currently, the uptime of the services is 65-70%; While in inquiry services, less than 95% is not desirable at all.”
The CEO of Bimeh.com states: “While we are facing very low quality, we have to accept these prices, which is not economically justified for us; Because the number of inquiries and the ratio that turns into a definite sale are vastly different.
Resistance of Central Insurance against protests
Following the suspension of insurance startups’ access to inquiry services, the Fintech Association also protested and warned against this action in a letter addressed to “Mohammadreza Aref”, the first vice president “the limitations and monopolies created in the insurtech industry can become a serious obstacle for the development of Iran’s digital economy.”
In a letter addressed to Abdolnaser Hemmati, the Minister of Economy, the Electronic Commerce Association considered the sale of information by Fanhab, as an arm of the Central Insurance, to be contrary to Regulation 105 of the Supreme Insurance Council and raised the question, “What is the relationship between the sale of information and the effort of the Central Insurance to Does it have national data and information management?
However, the situation is still the same and the Central Insurance has not retreated from its position until now. In recent days, this institution is involved in changing the president and it has to be seen whether the presence of “Parviz Khosroshahi” as the new president of Central Insurance will bring about a change in these policies or not.
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