AZ Re: The large infrastructure projects are beneficial for the local insurance industry

19 June 2014 — Daniela GHETU
AZ Re: The large infrastructure projects are beneficial for the local insurance industry
fuad_kuliyev"The insurance market in Azerbaijan demonstrates stable growth, which is ensured by the effective policy of the state insurance supervisor and the timely introduction of legislative acts," considers Fuad KULIYEV, Chairman of the Management Board, AZ Re. "Insurance companies in Azerbaijan have recently increased their capitalization in response to the new requirements, which also influences the market favorably. Along with that, the general economical development stimulates the growth of the insurance markets."

Among the large projects exerting a positive influence on the insurance market, Fuad KULIYEV mentioned a few relevant examples as: the large-scale business projects, important social projects like new underground metro stations and tunnels, roads and road junctions, as well as organizing international events and competitions such as the First European games also known as the 'European Olympics' to be held in Baku in 2015, the Fourth Islamic Solidarity Games in 2017 and the Formula 1 Grand Prix in 2015.

In this favorable context, being a strong local player is an important competitive advantage for AZ Re: "Following the development of the direct insurance market in Azerbaijan, AZ Re also increased its gross written premiums in 2013 by 30%, from AZN 30.3 million, in 2012 to AZN 39 million in 2013. We managed to maintain a healthy spread between the various lines of business with the largest growth sources being, just as before, property and CAR&EAR. The major development factors for AZ Re's business remain the best local risk expertise therefore our advantage in comparison with the international market: we speak the language and do not require the translation of documents, we actively participate in risk underwriting where needed in joint surveys, we assist in claim settlement in court consultations, we remain in the so-called group 1 of reinsurers that eliminates additional reservation for direct writers."

AZ Re Reinsurance OJSC is the only reinsurance company in Azerbaijan with a paid-up capital of AZN 40 million, which commenced its operations on November 1st 2007. Today, AZ Re Reinsurance is not only a leading reinsurer on the local market, but it also operates very successfully on foreign markets. Currently, the total assets of the company exceed AZN 69.2 million. In 2013, the company recorded a net profit of AZN 5.8 million.