The insurance industry is still feeling cautious about doing business in Iran because of lingering sanctions, according to a survey released today.
The study, conducted by global law firm Clyde & Co, discovered that 85 per cent of London insurance professionals felt discouraged from doing deals with the country because of remaining US sanctions which make it near impossible for US entities to trade with Iran.
"Interestingly, even those London-based insurers with no US operations are very concerned about the remaining US sanctions," said Chris Hill, partner at Clyde & Co. "Those sanctions are proving a strong disincentive to such insurers providing cover for permitted EU-Iran trade."
Problems insurers could still encounter when trying to trade in Iran include not being able to use US currency as a base for transactions, not being able to contract a US-based reinsurer and worrying that lifted sanctions might be reinstated at some point.
Hill added: "One issue is the prospect of a new US President in 2017. The easing of US-Iran sanctions has been done by Presidential waiver so the next President would have to explicitly approval the deal."
Despite these concerns, desire to do business with Iran has increased among insurance professionals, with two-thirds (67 per cent) saying their appetite for such deals had increased since the many sanctions were formally lifted in January.