الهيئة العامة للرقابة المالية

• FRA seeks to boost returns on government insurance funds by investing via Stock Exchange open-ended funds.

Dr. Mohamed Farid:

• Regulating Government Insurance Funds’ investments is essential to maximize returns.
• Every pound in governmental insurance funds is a public trust belonging to citizens, and it is our duty to preserve and maximize its return.
• The Funds must be managed in the best interest of beneficiaries, adhering to top standards of investment, governance and risk management.
• The resolution mandates Funds with over EGP 100 million in assets to invest 5% to 20% of total assets in listed equities via open-ended investment funds.
• A six-month compliance grace period has been granted. As of June 30, the total investment volume of these Funds stood at EGP 2.1 billion.

In a first-of-its-kind regulatory step aimed at boosting the efficiency and management of government insurance funds, FRA chaired by Dr. Mohamed Farid, issued a resolution mandating these funds to invest in open-ended funds.

The resolution mandates that Funds exceeding EGP 100 million in investments must allocate between 5% and 20% of their total assets to listed equities. Investment in any single open-ended fund must not surpass 5% of the government fund’s assets or 10% of the open-ended fund’s net asset value (NAV), whichever is lower. The Authority set a 6-month grace period for compliance, with the possibility of extension.

Dr. Mohamed Farid asserted that regulating these investments is essential to maximize returns and enhance management efficiency. This move is part of a comprehensive vision to strengthen the Funds’ capacity to achieve their core insurance and social objectives.

Government insurance funds are distinct from social insurance (pensions). Established by state decree and supervised by FRA, these funds protect specific groups – benefiting approximately 29 million people – from risks typically declined by insurance companies or those the government chooses to manage directly.

Dr. Farid added: “These Funds must be managed in the best interest of beneficiaries, adhering to top standards of investment, governance and risk management.”

FRA Chairman explained that every pound in government insurance funds is a public trust belonging to citizens, and their duty is to preserve and maximize its return. He stressed that these decisions safeguard beneficiary rights and guarantee Funds’ ability to meet their obligations.

He affirmed that the future of citizens’ insurance services relies on the professional management of these assets, noting that any improvement in investment return directly translates into an enhanced capacity for the Fund to fulfill its commitments.

He highlighted that deepening coordination between the Capital Market and the Insurance Sector is now a fundamental pillar for improving the investment performance of all insurance funds. This is achieved through strategic partnerships that enable the diversification of financial instruments and expand opportunities for safe investment.

FRA registers approximately six government insurance funds covering diverse sectors, including custody risks, postal services, commercial fishing vessel insurance, fast transport vehicles accidents and insurance/care for Al-Azhar students.

The total investment volume of government insurance funds reached EGP 2.1 billion as of June 30, 2025. These assets are distributed across various channels, including money market and fixed-income funds, unlisted equities, current accounts, treasury bills and bank deposits.

These efforts align with the Authority’s integrated approach to enhance the competitiveness of the non-banking financial sector and ensure professional fund management, benefiting both the State and the beneficiaries.

On the other hand, FRA mandated private insurance funds last February to allocate between 5% and 20% of their assets to invest in open-ended funds that invest in listed equities.

The Authority also required insurance companies to invest at least 5% of their free funds in open-ended funds that invest in listed equities