MOLDOVA: in the first three years since introduction of the strategy for the non-bank financial market development, about 80% of measures implemented

30 June 2021 —
In the first three years since introduction of the strategy for the development of the non-banking financial market for 2018-2022, about 80% of the measures included in the Action Plan have been implemented, stated CNPT representatives for

According to Tatiana CIOBANU, Director of the Insurance Department and Veronica CUHAL, Director of the General Directorate for Institutional Development and External Relations at CNPF, the measures planned and implemented in insurance include development of a regulatory framework for the transition of corporate management of insurance companies to the Solvency II regime; transition from the concept of mediation to the concept of distribution of insurance services; elaboration of normative acts of tariff liberalization in MTPL; development of minimum standards for risk-based supervision in the insurance industry; and much more.

Speaking about the market results for the first quarter, Tatiana CIOBANU and Veronica CUHAL noted that the market grew by 14.85% y-o-y with non-life still prevailing (93.24% of all GWP). There is a trend towards a slight decrease in the share of life insurance (6.76%) compared to 2020 (7.58%). In the reporting period, the level of market concentration increased - the top five accounted for about 76% of total GWP.

There was recorded a decrease in paid claims (by about 14.38%). During the period, 95.57% the insurers paid under non-life policies, and just over 4% under life insurance policies. The level of paid claims in GWP was a bit more than 40%, having decreased in absolute terms by 13.84 p.p. compared to the same period of the previous year.

The coronavirus crisis slowed down economic activity, and the insurance sector was one of the most vulnerable industries, the portfolio of companies' contracts seriously reduced. The CNPF has taken several measures to simplify the activities of professional participants in the insurance market. In the first half 2021, the regulator predicts a GWP increase as a result of an increase in MTPL insurance contracts and recovery in issuance of Green Card policies thanks to resumption of travel abroad.

CNPF's activities are mainly focused on reforming the insurance regulation and supervision. The new rules and procedures, approved in the first reading in December 2020, are to modernize the insurance sector, to create the foundation for implementation of the Solvency II. CNPF will continue to work on eliminating the consequences caused by COVID-19. The main challenge is to strengthen the ability to anticipate operational and financial risks, identify existing vulnerabilities and implement best regulatory and supervisory practices in the market sectors, the regulator's representatives explained.