Insurance market improves growth, but remains dependent on mandatory insurance

2025-10-28 22:57:00, Ekonomi CNA

The insurance market is growing at a faster pace for 2025. According to data from the Financial Supervisory Authority (AMF), the insurance market for the 9-month period of 2025 reached a value of gross written premiums of 20.2 billion lek, with an annual growth of 10.4%. A year ago, at the end of the 9-month period, the growth had been 7.4%.

In part, the improved market growth is due to a reduced exchange rate effect, given that a significant portion of insurance products are sold in Euros. According to the AFSA, in the first half of the year the share of gross written premiums in Euros against the total increased to 31.4%, from 33.2% for the same period a year earlier.

On the other hand, the depreciation of the Euro has also slowed down this year. On an annual basis, the Euro-Lek exchange rate is down by approximately 2%, while a year ago the decline was close to 7%.

At the level of market segments, the life insurance market continues to have higher growth rates compared to the larger non-life insurance segment.

For the 9-month period, gross written premiums increased by 13.5% compared to a year earlier (a year earlier the increase had been 9.2%).

The Life Insurance market continues to rely heavily on debtor life insurance. This product accounts for almost 83% of the total volume of gross written premiums. The debtor life product is almost entirely linked to the performance of bank credit. Most banks require life insurance for long-term credit contracts. Typically, these insurance contracts are required for loans for the purpose of purchasing real estate.

The insurance market is growing slower in its largest segment, non-life insurance. Gross written premiums for the first nine months of 2025 reached 18.5 billion lek, up 10.1% compared to the same period last year. However, growth in this segment has also improved from the 7.2% rate of the previous year.

The non-life insurance market continues to rely mainly on compulsory motor insurance. These products accounted for more than 67% of gross written premiums for the 9-month period ended 31 December 2025. Gross written premiums increased by approximately 13%, mainly supported by domestic TPL insurance.

In part, the increase in gross written premiums is due to the new risk-based premium allocation system, which has led to an average increase in the cost of insurance premiums of approximately 6%.

Special voluntary insurance products, mainly Casco motor insurance, are also showing double-digit growth this year. Gross written premiums for this product have increased by almost 11% compared to a year ago, supported especially by the expansion of the car rental business.

Health insurance and civil liability insurance are also showing high growth.

Meanwhile, property insurance against fire and natural forces, which is also the main voluntary insurance product, is also recording modest growth this year. According to AFSA figures, gross written premiums for the 9-month period were worth 1.89 billion lek, with an increase of 4% compared to a year earlier./ Monitor