STATISTICS: RUSSIA, 3Q2018: the growth of the market driver, life insurance, was over 40%

19 December 2018 —
STATISTICS: RUSSIA, 3Q2018: the growth of the market driver, life insurance, was over 40%
For 9 months this year Russian insurers generated GWP in the amount of RUB 1.093 trillion (+13.65% y-o-y). In European currency, due to significant depreciation of the local currency against euro, the market growth looks much more moderate - only 2.05%, according the Bank of Russia data.

Life insurance is still the market driver, its growth y-o-y reached 40.72% and its market share increased to almost 30%. Non-life segment, accounting for over 70% of the market GWP, went up only by 4.9%, although in euro it even dropped by 5.81%. Among non-life classes the most impressive growth rate (+30.26%) was recorded by insurance against accidents and illnesses.

Among the most important voluntary classes one should note the growth of Motor Hull by 2.9% to RUB 121.4 billion. Total number of the agreements here increased by 23.5% y-o-y. Paid claims in this class decreased by 2.3% to RUB 61.3 billion. Total number of claimed losses went down to 764 thousand (vs 780 thousand a year ago). Some representatives of rating agencies and TOP-5 insurers of Motor Hull speaking about factors of its growth pointed out increasing sales of vehicles, which according to Iliya GRIGORIEV (director of the underwriting and methodology department of AlfaStrakhovanie) went up by 14.9%, as well as growth of total number of agreements with franchise and discounts, increasing loan activity, and strong competition. A representative of VSK believes that Motor Hull profitability is influenced by decreasing accident ratio, video record of traffic rules violation, decreasing average speed limits, as well as decreasing tariffs and insurers' focus on the profitability, natural for a highly competitive market of 5-10%.

Agro insurance, which keeps one of the smallest market shares, amounted to only 0.25% of total GWP and dropped by 14.27% y-o-y. Based on 3Q2018 agro insurance premiums amounted to RUB 2.7 billion, RUB 1.4 billion of which were generated under agreements with state support, and RUB 1.3 billion - under non-subsidized agreements. According to the National Association of Agriculture Insurers (NAAI) from January to September 27 insurance companies had been active in agro insurance. During this period total number of new agreements reached only 50.5 thousand, while according to 2016 data, total number of agricultural organizations in the country was 36.1 thousand and the number of farmer enterprises and individual entrepreneurs amounted to almost 175 thousand. As the President of NAAI, Korney BIJDOV emphasized "agricultural industry is substantially underinsured". According to him the negative effect comes mostly from the change of the subsidy procedure in 2017.

It can be also noted that total amount of commission, received by intermediaries for 9 months, grew significantly (+22% y-o-y), exceeding RUB 179 billion, while GWP, collected through intermediaries, amounted to RUB 767 billion (+12.5% y-o-y). The leading sales channel is banking one (before - individual agents), which generated 48.3% of all premiums, collected through intermediaries. Banking sales is the main channel of distribution of insurance products in life insurance, insurance against accidents and illnesses and insurance of property of individuals, thanks to dynamic development of investment life insurance and lending to individuals. The share of individual agents is about 25% of premiums, generated through intermediaries. Sales through individual agents prevail in MTPL.

SOGAZ keeps the leading position on the market, however its share y-o-y decreased from 14.41% to 12.87%. Paid claims of the market leader demonstrated rapid growth (over 35%) by contrast with its premiums. The second leader - SBERBANK Life insurance, on the contrary, increased its market share from 7.29% to 11.25%, yet the growth of premiums and paid claims of this insurer among TOP-5 market players are the most impressive. The only company from TOP-5 that recorded a decline of paid claims y-o-y is RESO-GARANTIA (-6.77%).

*1 EUR = 68.4483 RUB (September 30th, 2017)

1 EUR = 76.2294 RUB (September 30th, 2018)

Access and download the 3Q2018 Russian insurance market statistics (in EUR and RUB).

  • Gross written premiums
  • Paid claims
  • Growth rates
  • Market rankings