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XPRIMM News No. 194, February 16th, 2012

Insurance Newsletter, No. 194, February 16th, 2012

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Many insurance professionals believe that in 2012 we will witness a market trend reversal in what the MTPL rates are concerned, as motor lines’ profitability already became a touch stone for the industry. In your opinion, what should one expect in 2012 with regard to the MTPL tariffs in the CEE countries?

- Price war will continue, with strong impact on profitability
- MTPL prices will remain quasi stable
- There will be timid signs of MTPL rates' increase
- Mixed evolution across the region, with a dominant trend of increasing MTPL tariffs
- Definitely, MTPL tariffs will visible climb up

Cast your vote.
Add a comment.

Unit-Linked plays the leading role in the CEE life insurance market
by, 2012-02-08
Life insurance products linked to investment funds (usually known as Unit-Linked life insurance) seem to be more and more popular in the CEE region. According to the 3Q2011 data available, the y-o-y nominal growth rate calculated in Euro for this line of life insurance products was of 11.73%, showing a significantly better dynamic than the entire life insurance segment which recorded a slightly negative trend. Calculations made by in local currency demonstrate the same trend, only "translated" in positive figures, as UL insurance GWP grew by about 18.5%, while the entire life insurance segment recorded some 4.3% growth. As a result, UL life insurance line represents now a roughly 40% share of the entire CEE life market.

EIOPA: Increased significance of the comparison websites; closer attention needed to consumer protection
by, 2012-02-07
"Commercial insurance comparison websites have gained increased significance over the past few years. These websites are an increasingly used means of communication or distribution channel that enhance comparability of information for consumers. Therefore, they have helped to stimulate more competition between insurers and intermediaries" says the most recent report released by the European Insurance and Occupational Pensions Authority, "EIOPA's Initial Overview of Key Consumer Trends in the EU".
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CZECH Rep: Dropping motor insurance prices cast the market in negative territory
by, 2012-02-10
After succeeding to surpass the crisis' peak without leaving the positive territory, the Czech insurance market ended its 2011 "in red", for the first time after many years of growth. According to the statistics recently published by CAP (Czech Insurers Association), its member companies, accounting for a 98% share of the domestic market, collected Kc116.3 billion in premium, which is a 0.3% lower figure than in 2010. In European currency, the GPW volume reached EUR 4.51 billion, 3.15% down as compared to 2010, being also negatively impacted by the 3% y-o-y depreciation of the Czech Kroon's exchange rate.
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CROATIA: 2011, another year of crisis for insurance business
by, 2012-02-10
In 2011 insurance companies operating in Croatia recorded GWP of HRK 9.14 billion (EUR 1.21 billion), 1.08% less compared with 2010, according to financial data published by Croatian Insurance Bureau (HUO). In absolute values, out of a HRK 100.3 million decrease, HRK 73.8 million related to non-life insurance, while the HRK 26.5 million decrease related to life assurance.
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ALBANIA, FY2011: GWP over the EUR 60 million threshold
by, 2012-02-10
Albania's insurance market grew in local currency 2.3% in 2011 compared to the previous year (excluding reinsurance written premiums), according to data published by Albania's Financial Supervisory Authority (AFSA). In European currency, insurance premium revenues were about EUR 60.01 million. At the same time, the number of insurance contracts was of 1,306,602, up by 77.5% compared with year 2010.
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KAZAKHSTAN, 2011: The market entered "the first billion euro" area
by, 2012-02-10
In 2011, the gross premiums written by the 38 insurance companies in Kazakhstan increased in local currency by 29.32%, reaching KZT 198.50 billion (EUR 1.04 billion), compared to KZT 153.50 billion (EUR 786.24 million) in 2010. Claims paid by insurers amounted to KZT 46.14 billion (EUR 241 million) according to official data published by the Supervisory Commission of Financial Markets.
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AZERBAIJAN: Mandatory lines drove insurance market up 37% in 2011
by, 2012-02-10
Azerbaijan-based insurance companies posted in 2011 an impressive double digit nominal y-o-y growth rate of 37%. Denominated in European currency, the 2011 GWP figures show even a higher dynamic, of 42%, due to an almost 4% strengthening of the Azeri currency, Manat (AZN). Thus, the GWP volume reached EUR 209.26 million, of which a share of about 26% comes from the mandatory insurance lines, including MTPL.
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MOLDOVA: Insurance market exceeds MDL one billion
by, 2012-02-13
MDL one billion (EUR 61.4 million) wrote in premiums the Moldavian insurers in 2011, 9.7% more than a year earlier, according to the preliminary financial data centralized by the National Commission of Financial Market (NCFM). Claims reached MDL 334 million (EUR 20.45 million), a 3.5% increase in comparison to 2010.
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SLOVENIA: Over EUR 6 million in claims after the February hurricane strength "bora"
by, 2012-02-14
The hurricane force icy "bora" wind which affected the Slovenian littoral during the first days of February caused more than EUR 6 million of damage, according to Slovenian insurers' first estimates. Most damage was caused to the roofing and buildings. Insurance companies have already received around 1,000 claims, especially related to the windstorm damages in Gorizia, Vipava, Karst and Inner areas.
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RUSSIA: New law concerning periodical technical inspection creates tension on the insurance market
by, 2012-02-14
Beginning of 2012 was defined by several conflicts between insurance companies as a result of new law on periodical technical inspection of vehicles (PTI), wich was approved in June, 2011 and entered into force on January, 2012.
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MUNICH Re: "We have never experienced a year like 2011 before"
by, 2012-02-03
MUNICH Re's preliminary figures show a profit of EUR 0.71 billion for 2011, down 70% on the EUR 2.4 billion profit it made in 2010 due to "a series of severe earthquakes and many weather-related catastrophes", reported this week the reinsurance group. Thus Munich Re estimates its claims costs from the earthquakes in Japan and New Zealand at around EUR 1.5 billion for each event.
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INGOSSTRAKH leaves Finnish market
by, 2012-02-13
Russian insurance company INGOSSTRAKH has sold the portfolio of its Finnish subsidiary (IngoNord), to DARAG Deutsche Versicherungs- und Ruckversicherungs-AG (Germany), announced the group last week. The price of the transaction was not disclosed.
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LITHUANIA: Bank of Lithuania takes over the insurance supervision task
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UNIQA estimated losses of EUR 330 million in 2011
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ARMENIA: Losses on MTPL segment represents 54% at the end of 2011
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ESTONIA: QBE Insurance decided to stop activities
EIOPA calls the academic community to join the Insurance and Reinsurance Stakeholder Group
ACE Group: lower profit due to natural disasters
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KBC Group posts 2011 net profit of EUR 13 million
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Credit Europe Asigurari
2012 Aon's Political Risk Map: 2 upgrades and 3 downgrades for the CEE&CIS countries
by, 2012-02-14
In the CEE and CIS regions, Republic of Moldova and Ukraine's political risk lowered, while Azerbaijan, Belarus, Croatia are bearing a higher political risk as compared to 2011, according the 2012 Aon Political Risk Map. Although EU and OECD member states were not rated in the 2012 edition of the map, Romania and Bulgaria were still taken into consideration and assigned a Low-Risk rate.

Weak demand for Hungarian bonds at February 9th auctions
by, 2012-02-10
Hungary's Government Debt Management Agency (AKK) has received HUF 62.2 billion worth of bids from primary dealers on a HUF 43 bn lot of bonds and in response to the muted demand it sold only HUF 40 bn worth of debt at auctions on Thursday, February 9th. The average yields were set close to yesterday's benchmark fixings, while they were considerably below the average yields at the previous bond auctions a fortnight ago thanks to the marked drop in yields during this period.

Polish T-bonds best in world - Bloomberg
by, 2012-02-10
Polish T-bonds offer the best yields weighted by risk in Europe, according to a report published by Bloomberg agency.

ALBANIA: Competition Authority to investigate compulsory vehicle insurance rates

ARMENIA: 74 thousand cars do not have insurance

ARMENIA: Life insurance to be gradually introduced

AZERBAIJAN: Law on use of "e-signature" in insurance market to come into force until the end of 2012

BULGARIA: Insurers' 11-mo Gross Premiums Edge down 0.9%

CROATIA: Austria's Wuestenrot Sets up Life Insurance Unit

KAZAKHSTAN: Mergers might take place in insurance market in 2012

LATVIA: Citadele Life substantially expands market share

MOLDOVA: MOLDASIG and beet growers take a break in dispute on harvest loss compensations

POLAND: Record year at CONCORDIA Ubezpieczenia

SERBIA: Tax relief on voluntary pension fund contributions has increased

TURKEY: Bank Asya in talks on sale of insurance unit Isik Sigorta

Icy roads heat up the pricing dilemma

Two major car crashes, involving about 100 damaged cars, that occurred on Wednesday, on the Czech highways are making the headlines all around the world, together with the dramatic summing-up of the victims produced by the heavy winter in Eastern Europe. Read more

BCR Asigurari de Viata


CEO of GENERALI PPF Holding, Chairman of the Board of CESKA pojistovna, Chairman of Czech Insurance Association

Even though the volume of premium written in life insurance has been rising, insurance companies face several significant negative factors - long-term decline in the number of active policies, growing lapse rates and speculative rework of policies by some unreliable insurance intermediaries. Also the amount of insurance fraud is growing at this time of economic difficulties, by tens of percent. However, neither of these cases are the specifics of the Czech market, we can observe similar trend in other CEE countries. Read more

Eastern Re

CEE Unit-Linked ins. indicators 3Q 2011
CZECH Rep. FY 2011



Motor insurance in emerging markets - is the price war over?

What do car owners want from their insurer: cheap policies, extended coverage, additional services, big compensations for bodily injuries, fast payment of claims? And what can they really get?
Where is the right balance between satisfying as much of the clients' needs and a sound underwriting in motor insurance? For how much accounts in this equation dealing with trans-border claims, considering not only the possible regulatory differences but also the cultural ones?

Media XPRIMM and Istanbul Underwriting Center invite you to find the right answers and share your views with a group of reputed professionals on the occasion of the IIF 2012.

See you in Istanbul!
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International Conference Insurance in Central Asia
March 15-16, 2012
Alma-Ata, Kazakhstan
Organizer: InterConsult
Media Partner: PRIMM Insurance & Pensions Magazine
For details:
XVI All-Russian Reinsurance Conference
March 22-23, 2012
Moscow, Russia
Organizer: Reinsurance Committee of the All-Russian Insurance Association and Delovoy Format Group.
Media Partner: PRIMM Magazine - Insurance & Pensions
For details:

Tashkent International Investment Financial Forum
April 4-8, 2012
Tashkent, Uzbekistan
Organizer: SAIPRO
Media Partner: PRIMM Insurance & Pensions Magazine
For details:
FIAR 2012 - International Insurance-Reinsurance Forum
May 20-24, 2012
Sinaia, Romania
Organizer: Media XPRIMM
For details:
Kuwait Insurance Forum 2012
May 29-30, 2012
Radisson Blu Hotel, Kuwait City
Organizer: ProMedia International
Media Partner:
For details:
WorldPensionSummit 2012
November 14-16, 2012
Amsterdam, Olanda
Media Partner: XPRIMM Publications
For details:
BCR Asigurari de Viata VIG

Weren't for the crisis, we would have probably talked today of double digit growths, and by double digit I don't mean 12%, I mean around 20%, values similar to the growths registered before 2008. Taking into account the special context we find ourselves in today, of course we talk about modest growths compared to what could have been if not for the economic global crisis. Read more


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