RUSSIA, 1H2018 result: GWP went up by more than 13% while paid claims went down by 14%

4 October 2018 — Marina MAGNAVAL
Total GWP for the first half year amounted to RUB 731.78 billion (~EUR 10 billion; +13.28% y-o-y in local currency), according to the Central Bank of Russia. Total paid claims went down by 14% to RUB 235.78 billion (EUR 3.2 billion).

The GWP of voluntary non-life classes reached RUB 401.9 billion (EUR 5.5 billion). The market driver, life insurance, saw noticeable premium growth of 45.7%. Significant growth was also recorded by accidents and diseases (+27.3%), cargo (+17.5%) and property of individuals (+11.49%). For the first time since a long time growth rate was recorded also by Motor Hull (+3.1%), however, in euro this segment still had a declining trend due to rapid depreciation of the local currency. The GWP of mandatory classes in general decreased (-6.36%). Among mandatory classes the biggest decline was demonstrated by personal insurance, MTPL saw a decline as well (-1.7%) with GWP amounting to RUB 107.3 billion (EUR 1.47 billion).

Market paid claims dropped by 14.05%. But life paid claims went up dramatically (almost by 50%). Paid claims in the non-life segment decreased, while some certain classes' paid claims went up. MTPL paid claims also dropped by 35.75%, to RUB 66.5 billion (EUR 0.9 billion).

The growth in total number of insurance agreements in the market was rather moderate if compared to GWP, the growth rate of insurance agreements amounted to 6.7%. Among key classes, the highest growth in concluded agreements was recorded by life insurance (+24.5%), while the number of MTPL agreements dropped by 5.1%, to 19 million units. Voluntary health insurance (VHI) had a positive trend - the total number of agreements went up by 5.9%. Aleksey BREDIKHIN, the director of ACRA Ratings, believes that VHI is one of the most stable segments, showing constant growth. According to market experts, the growth rate of VHI is based on the inflation of medical services cost (+4.9% for 1H2018), promotion of the so-called "packaged insurance products" and expansion of insurance against critical diseases.

As for statistics of payment for intermediary services, the total amount in the first half year increased by 18.6%. GWP generated through intermediaries went up by 11%. According to the Bank of Russia, the leading sales channel is banks, which accounts for almost half (47.5%) of total GWP received through intermediaries. Sales via banks are the main distribution channels of products in life insurance, accidents and diseases and property of individuals. The share of individual agents amounted to 26.9% of total GWP, received through intermediaries.

SOGAZ keeps the leading positions in the market (GWP growth by 5.41%), the TOP-5 also includes SBERBANK Life insurance, VTB Insurance, AlfaStrakhovanie, and RESO-GARANTIA.

Access and download 1H2018 Russian insurance market statistics.

Find detailed 1H2018 market data in the forthcoming edition of the XPRIMM Insurance Report CEE, SEE & CIS - 1H2018, to be launched on 21 October, in Baden Baden

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