BMI reports that they would be surprised and disappointed if conditions did not improve significantly for the country's life insurance segment. According to the insurers' trade association, life premiums in the 2012 were 9% lower than they had been in 2011. A major challenge has been the volatility of financial markets in the euro area which, in turn, has had an impact on sales of unit-linked products. However, markets appear to have stabilised, thanks in part to the announcement of the European Central Bank in September last year that it is prepared to undertake Open Market Transactions and the more recent resolution of the crisis in Cyprus.
Another key development is Nova KBM's sale of its 51% stake in Zavarovalnica Maribor to Sava Re and SOD. After Triglav, the (still majority) state-owned former monopoly, Maribor is the second-largest (composite) local insurer. Nova KBM was looking to sell mainly because it is keen to boost its overall capital, in line with the recommendations of the European Banking Authority. In 2011, Maribor accounted for just over one-eighth of the premiums written in each of the life and the non-life segments. KD Group has announced a major reorganisation, and it clearly looking to expand the footprint of its insurance operations Adriatic Slovenica and KD Life outside Slovenia. Meanwhile, Triglav's management is taking a number of steps to boost profitability.
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SLOVENIA: Prospects for growth in insurance sector over the medium term are fairly uninspiring
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