CROATIA Osiguranje returns to profit following restructuring process

3 December 2015 — Vlad BOLDIJAR
For 3Q 2015, CROATIA osiguranje (CO) reported GWP of HRK 2.38 billion (EUR 312 million) up 3.7% y-o-y, according to the 3Q Report published on the CO's main shareholder, ADRIS Grupa, website. About 19% of total GWP was generated by the life segment, while the remaining 81% was accounted by the non-life sub-classes. At the same time, the CO Group members paid claims of about HRK 1.13 billion (EUR 149 million), 7.1% less y-o-y.

ADRIS Group pointed out that the "restructuring process of the company is still on-going (...) and has produced visible results in financial performance". For the first nine months CO's profit before tax amounted to HRK 136.0 million (EUR 17.8 million), whereas last year the company recorded a loss of HRK 178.9 million.

ADRIS Grupa mentioned that the restructuring process of CO includes changes in the employment structure in favour of the sales force. At the same time, "the integrated HR management project is currently underway including rewards models and performance and career development management. The centralization of the support functions and claim management processes has already produced results in terms of reducing operating costs. In the following period the focus will remain on further increase in productivity through operational excellence and digitalization".

According to the Rovinj-based holding, in the key Croatian market, CROATIA osiguranje, together with CROATIA zdravstveno osiguranje (CROATIA Health Insurance) recorded an increase in the written premium of HRK 60.8 million to HRK 2.06 billion - which represents an increase of 3% y-o-y. "After a long-time trend of decline, the market share has been stabilized at 30.7 % (a rise of 0.2%)", ADRIS Grupa said in the Report.

Per segments, the non-life insurance operations of CROATIA osiguranje still hold a leading position with a market share of 36.6%, while in the life insurance segment, CO ranked second (18.1% market share) - but it is worth to mention that the value of GWP grew more than three times as high as this market segment (49.4% vs. 15.0%).

"The stabilized market share in non-life and a strong rise in life insurance are a result of stronger market orientation of the company. The emphasis is placed on the individual insurance segment and stronger involvement in sales channels where CO had a weak presence. The existing products have been improved and new ones developed, particularly in property insurance and health and life insurance".

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