Insurance market, growing slower this year

2024-11-27 08:26:00, Ekonomi CNA

The insurance market continued to grow during the month of October, supported mainly by compulsory insurance products.

According to data from the Financial Supervision Authority (AMF), at the end of the 10th month, gross written premiums reached the value of 20.3 billion ALL, an increase of 7.6% compared to the same period a year ago. Market growth this year is slower compared to 2023, partly influenced by the continued strengthening of the Lek in the foreign exchange rate.

According to the AMF data, for the first half of this year approximately 33% of the gross written premiums in insurance were calculated in foreign currency, mainly in Euro. Since the statistics are reported in lek, the strengthening of the local currency in the exchange rate has had a negative effect on the value of premiums written in foreign currency.

Beyond the negative effect of the exchange rate, the structure of the market by products this year does not show major innovations. Most products are following slow and organic growth, with compulsory insurance continuing to form the mainstay of the market.

For the 10-month period, gross written premiums in the Non-Life market increased by 7.5%, while in the Life insurance market by 8.5%.

The Non-Life segment continues to dominate, accounting for nearly 92% of gross written premiums.

Compulsory motor insurance remains dominant in the Non-Life market. At the end of the 10-month period, they accounted for 66.1% of gross written premiums, from 65.9% in the same period a year ago. The slight increase in the share of compulsory motor insurance has mainly come from the internal TPL motor insurance, while the weaker performance is shown by the Green Card and Border Police products. Since both of these products are sold in Euros, in this case too, it is estimated that the exchange rate has had a negative impact.

Catastrophe property insurance remains the leading voluntary insurance product, accounting for 10.4% of gross written premiums, up from 10.8% a year ago. CASKO insurance of vehicles follows, with 8.1% of premiums, from 7.2% in the same period last year.

On the other hand, damages this year are growing at significantly higher rates compared to last year. At the end of the 10-month period, their growth reached 22.7%, which is about three times higher compared to the same period of 2023. For the 10-month period, the gross damages paid amounted to 7 billion ALL.

The structure of claims in the Non-Life market continues to be dominated by compulsory motor insurance, with 70% of gross claims paid by Non-Life insurance companies./ Monitor Magazine