CZECH Rep: dropping motor insurance prices cast the market in negative territory

10 February 2012 — Daniela GHETU
CZECH Rep: dropping motor insurance prices cast the market in negative territory
xcom_statisticAfter succeeding to surpass the crisis' peak without leaving the positive territory, the Czech insurance market ended its 2011 "in red", for the first time after many years of growth. According to the statistics recently published by CAP (Czech Insurers Association), its member companies, accounting for a 98% share of the domestic market, collected Kc116.3 billion in premium, which is a 0.3% lower figure than in 2010. In European currency, the GPW volume reached EUR 4.51 billion, 3.15% down as compared to 2010, being also negatively impacted by the 3% y-o-y depreciation of the Czech Kroon's exchange rate.

The life insurance segment grew by 1.9%, in local currency, but the figures denominated in Euro show a 1% decrease, to EUR 1.76 billion. Life insurance products for which the premium is paid in several installments registered a positive dynamic, of about 2% in local currency, while on the single premium side, there was an almost 3% decline, although single premium products associated with the existing normally paid contracts (about 16% share of the life business) saw a 20% increase. However, the total number of life-insurance policies sank by over 100,000

Once again, motor insurance was the main reason of the y-o-y negative change in GWP for non-life insurance. Thus, in local currency, the total GWP for non-life fell by 1.6%, while de decrease calculated in Euro was of about 4.5%, down to EUR 2.75 billion. Both motor insurance lines - motor hull and MTPL - registered significant negative growth rates, of 10.7% and 6.6% respectively (Euro). The highly competitive and price sensitive market environment seems to remain the determinant driver of this trend. "I believe that last year was the last period when prices of motor vehicle insurance were decreasing. There is no space left for further price cuts and insurance companies will have to change their strategy for fighting for clients in the future", stated Tomas SIKORA, CEO of the Czech Insurers Association.

CESKA pojistovna remains the market leader, with a 26.9% market share, despite the negative change in GWP of about 8.3% (EUR). KOOPERATIVA pojistovna VIG ranks second, with a 19.5% market share. Both companies hold the same positions on the life and non-life insurance segments. Actually, their "parent" groups, GENERALI PPF Holding (CESKA pojistovna, GENERALI, CESKA pojistovna Zdravi) and VIG (KOOPERATIVA, CESKA PODNIKATELSKA pojistovna, POJISTOVNA CESKE SPORITELNY) are the strongest players on the Czech insurance market.

Access and download the FY2011 Czech Republic insurance market statistics.

Market portfolio:
  • Gross written premiums in European and local currency for analyzed periods
  • Paid claims in European and local currency for analyzed periods
Market rankings in EUR and CZK (GWP/Paid claims/Market shares/Growth rates):
  • Overall market ranking
  • Life insurance ranking
  • Non-life insurance ranking
  • Overall motor insurance ranking (motor hull and mtpl, added-up)
  • Motor hull insurance ranking
  • MTPL insurance ranking