KAZAKHSTAN: insurers VICTORY and NURPOLICY started merger

Insurance company VICTORY, which is in terms of assets is the 2nd insurer in the country (KZT 83.7 billion), announced about consolidation with the insurer NURPOLICY (27th place in terms of assets of 32 insurers), a subsidiary of NURBANK.

According to the portal allinsurance.kz this form of reorganization was caused by some problems of NURPOLICY, among them: undercapitalization, no insurance profit growth in 2017, increase of expenses and year-end loss (loss of KZT 204 million vs small profit of KZT 26 million a year before). Portfolio of NURPOLICY according to 2017 result amounts to KZT 3.7 billion, 90% of which is MTPL and this leads to high loss ratio. 78% of VICTORY's portfolio is property insurance, which is much more profitable and has smaller loss ratio. Stagnation of the local insurance market during some years makes insurers revise and correct their development strategies, in particular by consolidation.

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