Two months deadline given for Afghan businesses to get insurance

Afghan Ministry of Finance issued a two-month deadline for all commercial businesses in the country to get insurance in order to be able to operate in the country.

The Cabinet of Ministers decided to enforce mandatory insurance law for all commercial markets after the recent fire incident that broke out in one of Kabul’s major commercial zone, Fazi Mohammad Nasiri Market, and inflicted millions of dollars of loss to the shopkeepers.

The decision was approved at a meeting chaired by President Hamid Karzai last month.

Fazl Bari Mumtaz, head of the Insurance Affairs Department at the Ministry of Finance said no business without insurance will be allowed to operate.

Insurance is a relatively unknown culture in Afghanistan. The Afghan government has, recently, begun raising awareness about the importance of insurance for Afghan businesses. Security issues, lack of public awareness, and absence of a training center on insurance are the main factors that have slowed down the spread of insurance culture in Afghanistan.

Given the security situation of Afghanistan, the important of property insurance for businesses cannot be overstated.

The Insurance Affairs Department of the finance ministry is working on a strategy to regulate the insurance sector, requiring providers to have back-up insurance so they can pay for their damages of their clients in a timely manner.