STATISTICS: ARMENIA, FY 2014: The market's results have significantly deteriorated

If in the first half of 2014, the Armenian insurance market stagnated, despite a certain growth of the key indicators, for the entire 2014, the market's results significantly deteriorated. Namely, gross written premiums decreased by nearly 13%, compared with claims that increased almost twice (22.86%). The largest growth of claims, 138.51%, was reported on the accident insurance segment, the most popular type of insurance in Armenia.

"In 2014, the main decrease in gross premiums - 60.75% -, was recorded by the health insurance line. One of the causes for this decrease was the government's decision to take a part of the social package of state employees - namely, a significant share of these packages included in the compulsory health insurance -, from the insurance companies and give it to the Ministry of Health. For the implementation of these social packages, the insurance companies had spent considerable resources, such as building their own clinics and medical centers, in the hope that compulsory health insurance will become universal in 2015," explained Emmanuil MKRTCHYAN, General Director, ArmInfo News Agency.

The most profitable and effective segments remain the property and Cargo insurance lines.

The insurers' expectations regarding the mandatory MTPL policies, seen as possible growth drivers for the market, were not confirmed. The loss ratio on MTPL insurance is 60%, while insurance companies estimated this index at 70-75%.

According to Misak BABAJANYAN, Executive Director, Armenian Motor Insurers' Bureau, there are certain problems on the MTPL insurance segment, "which we are trying to solve. In particular, these include the disagreement regarding the amount of paid claims. In particular, we are talking about the request from insured persons for re-examination of claims record addressed to the Bureau and also appeals to the Financial Ombudsman Institute (also named as Public mediator)".

Insurers are hoping that than accounting system "malus" system will work efficiently, it will help increase the MTPL insurance segment and the number of reported road accidents will be reduced, as drivers become more responsible.

Access www.xprimm.com and download the FY2014 Armenian insurance market statistics.

Market portfolio & market rankings (in EUR and AMD):
  • GWP
  • Claims
  • Growth rates
  • Market shares

Follow XPRIMM Publications on LinkedIn, for more data on the insurance and financial industry.

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