Besides, activities of the Central Bank, the Bureau of Compulsory insurance, the Association of insurers as well as insurance companies, aimed to improve interest in compulsory property insurance, contributed to the positive dynamics.
From 2017 to 2019, GWP grew steadily, while in the first quarter of 2020 there was a sharp jump. At the same time, the dynamics of paid claims remained unchanged. The experts also note that the share of compulsory real estate insurance of individuals has significantly increased, while corporate real estate insurance has not shown any remarkable change. However, the experts emphasize great potential of compulsory real estate insurance on the market.
The Association mentioned that this insurance type is now offered based on the law adopted in 2011 and that appropriate legislative changes are required. In addition, digitalization is also needed.
According to Rashad AHMEDOV, the executive director of the Bureau, "potential of compulsory real estate insurance segment is quite big and growth perspectives are considerable. In general, according to our estimates, total potential of compulsory real estate insurance market in Azerbaijan is about AZN 200-250 million per year (~EUR 104-129 million). If we talk about GWP of compulsory property insurance in 2019, AZN 43.5 million were collected by insurers during last year", he said.