KAZAKHSTAN: in January this year, voluntary classes generated 87% of GWP as market driver

21 March 2019 —
In January this year, 87% of total GWP was generated by voluntary insurance. The total market GWP increased by 40.8% y-o-y and paid claims went up by 10.9%, according to the National Bank of Kazakhstan.

In terms of classes, GWP significantly increased in voluntary property insurance (+56.2%), its market share amounted to 61.6% (vs 55.5% a year ago), as well as in voluntary personal insurance (+53.8%), market share here totaled 24.9% (vs 22.8% a year ago), while compulsory insurance in January amounted to 13.5% of the market (vs 21.6% a year before) with a decrease of 12.4% y-o-y.

As for paid claims: 46.2% were paid in voluntary personal insurance (vs 40% last year), 33.1% in compulsory insurance (vs 36.1%) and 20.7% in voluntary property insurance (vs 23.9% in January 2017).

Specialists from the Association of Insurers of Kazakhstan noted that the insurance penetration degree in the country is very low, amounting to only 0.4% of GDP. Voluntary retail insurance, which is considered the market driver, can help improve the penetration degree, for example, to the level of Russia (2.4%), while in other developed countries this figure reaches 7-8%.

Kazakh insurers are making every effort to improve insurance transparency and to simplify procedures. In 2019, the market introduced online insurance, where vehicle owners can purchase e-policies, and a single insurance database was created. Based on January results, insurance for civil liability of vehicle owners amounted to 61.4% of compulsory insurance and 8.3% of the total market GWP, according to finprom.kz.