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Egypt announces new life insurance scheme for millions of casual workers

Ahram Online , Thursday 1 Mar 2018
Egyptian Casual workers
A file photo of Egyptian causal workers (Photo: Ahram Arabic website)
Views: 5831
Views: 5831

Egyptian Prime Minister Sherif Ismail announced on Thursday new measures to improve social protection for an estimated 15 million casual workers who face low job security, poor pay and no access to pensions.

Ismail announced a new scheme introduced by a number of state banks and state insurance companies to issue certificates of insurance for casual workers in a country where the informal economy is large and the social security scheme is inefficient.

Informal workers, which officials estimate at 15 million, include craftsmen, daily-hire workers and self-employed labourers.

The Aman Certificate (Security Certificate), worth EGP 500-2,500, provides insurance coverage and monthly pensions for casual workers with a 16 percent interest rate, Ismail told a conference on Tuesday where Egyptian President Abdel-Fattah El-Sisi inaugurated a new residential and touristic city in the Mediterranean's North Coast.

The policy includes coverage for natural and accidental death and pays one-time benefits of EGP 10,000-250,000 or monthly pensions of EGP 200-1,000 over five years or EGP 120-600 over 10 years.

The certificates can be issued to seasonal and temporary labourers between 18 and 59 years of age by their national identification cards.

All labour working in national projects are paid on a daily basis and have no access to pensions, President El-Sisi had said earlier.

Only 15 percent of the country's 96 million population and 500,000 of an estimated 15 million casual workers in Egypt are covered by social insurance.

During the conference, President El-Sisi urged the Armed Forces Engineering Authority and the Housing Ministry to issue insurance certificates for workers of civil companies working with them in two weeks' time.

He also urged businessmen and employers to work towards providing their irregular employees with social protection coverage.

The new insurance scheme comes months after Egypt launched a financial inclusion initiative aimed at increasing access to formal financial services. This makes it easier for the country to preserve its currency value and analyse market needs by ensuring transactions are made through the official market.

Egypt's unemployment rate stood at 11.3 percent in the fourth quarter of 2017, state statistics agency CAPMAS said earlier this month.

Egypt's planning minister said last September that the country's informal sector contributes about 40 percent of Egypt’s GDP, and PM Ismail has said that the sector is worth EGP 1.6 trillion.

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