RUSSIA: from January-March life GWP dropped by 5.5% y-o-y
GABUNIA believes that this decline can be explained by the introduction of a new ARIA standard on disclosure of information about the essence of ILI products, as well as the regulation of the Bank of Russia on disclosure of information to consumers. The total number of consumer complaints in the first quarter increased by 85% y-o-y.
According to the general director of ROSGOSSTRAKH Life, Alexey RUDENKO, one of the reasons for the dropping ILI sales may be the fact that bank employees offer different products in response to consumers dissatisfaction with low ILI profitability. The market experts believe, that if life insurers do not find any alternative for ILI, then annual decline of the life GWP at the end of 2019 could be 10%. At the same time, as the General director of SBERBANK Life insurance, Alexey LEONENKO, noted, growth of the company's universal life insurance GWP reached 100% y-o-y.
In 1Q2019, total life GWP amounted to RUB 94.8 billion (-5.5% y-o-y). ILI generated RUB 45.8 billion in life GWP, credit life insurance generated RUB 20.8 billion (+23%), universal life insurance RUB 18.2 billion (+51.7%), other types RUB 10.1 billion (+9.8%).
The share of the TOP-5 insurers accounted for 67% of the life sector. The life leader, SBERBANK Life Insurance, holds 40% of total life GWP and 48% of ILI. The company's GWP in universal life insurance reached RUB 7.4 billion (+84%), credit life insurance was RUB 6.8 billion (+21%), and ILI was RUB 22 billion (+1.5%). Assets of SBERBANK Life insurance as of March 31, 2019, amounted to RUB 391 billion (+55%), insurance reserves were RUB 341 billion (+64%), the insurer reported.
*EUR 1 = RUB 72.7230 (31.03.2019)