The pandemic has prompted digitalization to become a key industry trend in the upcoming years. In addition, the new reality of 2020 has stimulated insurers to create new products in health insurance (coronavirus insurance, telemedicine, critical illness insurance), as well as insurance programs against business interruption, cyber risks, financial losses.

XPRIMM: 2020 was an incredibly challenging year for the insurance sector, demanding insurers to operate aggressively, and has changed the standard relationship between market players. Despite this difficult situation, premiums, net profit, income and expenses were growing. How did your company respond to the main challenges of 2020? Did it manage to complete the year with financial results better than in 2019?

Oleg KHANIN: In 2020, the GWP volume of Kommesk-Omir exceeded KZT 10.3 billion, which is about 7% more than in 2019. Financial assets exceeded KZT 26.4 billion, insurance reserves - KZT 12.9 billion, equity capital amounted to KZT 12 billion. Net profit increased by 369% year over year. At the same time, the company's paid claims in 2020 exceeded KZT 3.8 billion, which means a decrease of 18% y-o-y.

XPRIMM: What lines of business and insurance products recorded the most significant growth for your company despite the crisis? What factors contributed to the rise / fall in premiums and paid claims? Has the company's portfolio changed noticeably compared to 2019?

Oleg KHANIN: There was a significant increase of motor CASCO insurance (Motor Hull), GWP of which exceeded KZT 3.2 billion, 187% more y-o-y, as well as Perconal Accident Insurance with an increase of 866%, with GWP reaching KZT 508.2 million. The company's portfolio has not changed significantly.

XPRIMM: Can we say that, in general, 2020 was not a bad year for the insurance market and for your company? What learns for the future would you highlight based on the last year's results? What main events in the development of Kommesk-Omir in 2020 would you name?

Oleg KHANIN: 2020 was a difficult year for us, as well as for the entire insurance industry: quarantine, falling demand, transfer of employees to remote work. For almost 30 years of activity in the insurance market, Kommesk tried the "home office" model of work for the first time. The pandemic, introduction of the state of emergency and other accompanying factors contributed to the rapid transfer of all business processes of the company to digital format.

In 2020, we obtained a license to perform activities of our subsidiary life insurance company "Centras Kommesk Life" and started sales of compulsory Employer's liability insurance. We plan to update insurance products that have been adapted to the current conditions. The development strategy of "Centras Kommesk Life" is based on the implementation of a synergistic effect of interaction, which will result in availability and variety of products and innovations.

Also, last year, an international rating agency, A.M. Best, affirmed the financial strength rating "B-" and the long-term credit rating of the issuer "bb-" of Kommesk-Omir. The outlook for these credit ratings is stable.

XPRIMM: In your opinion, what trends, formed by the pandemic, will influence the further development of insurance? What innovations is your company planning to implement in 2021 and what are your expectations for 2021?

Oleg KHANIN: Many insurers have reconsidered their vision for doing business. So, 2020 demonstrated that more insurance services need to be transferred to the online format, remote services, and this is to be applied not only to sales, but also to claim settlement and other business processes. The pandemic has prompted digitalization to become a key industry trend in the upcoming years. In addition, the new reality of 2020 has stimulated insurers to create new products in health insurance (coronavirus insurance, telemedicine, critical illness insurance), as well as insurance programs against business interruption, cyber risks, financial losses. Our company's plans includes the further development of the information system and integration processes, the corporate website and personal accounts of insureds, cooperation with digital business partners, and personalization of insurance products. The growth drivers of insurance in 2021 may be the restoration of the purchasing power of the population, an increase in lending, investment attractiveness of life insurance products, and an increase in the customer service quality.