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In the first quarter of 2012, the insurance market contracted due to lower life assurance volumes

May 9, 2012

According to the data of the Bank of Lithuania, the amount of insurance premiums written in the domestic insurance market over the first quarter of 2012 made up LTL 397.7 million, which was 0.2 per cent less than over the same period last year. In total, 1.09 million of insurance contracts were concluded, which was 4.0 per cent more than in the first quarter of 2011. Over the first three months of the year, insurers paid claims for the amount of LTL 255 million or 1.8 per cent less than a year ago.

The contraction of the insurance market was mainly determined by the decline in the amount of written life assurance premiums of 8.5 per cent to LTL 120.4 million. Investment life assurance volumes declined the most – the amount of written premiums of this class of insurance declined, compared to the first quarter of 2011, by 15.4 per cent.

The number of contracts of all life assurance classes declined in the first quarter of this year, compared to the same period last year, by 10.4 per cent to 12,564 units.

Non-life insurance market developed in the opposite direction in the beginning of this year. Non-life insurance premiums written in the first quarter of 2012 amounted to LTL 277.4 million or 3.9 per cent more than during the same period last year. The non-life insurance market has been growing since the very beginning of 2011.

The positive change of this type of insurance was mainly determined by the rise in the volumes of transport (CASCO and motor third-party liability (MTPL)) and health insurance volumes.

According to the data of the Bank of Lithuania, over the first three months of this year, the number of non-life insurance contracts grew by 4.2 per cent and amounted to 1.08 million units. This was mostly determined by the growing number of MTPL and non-commercial property insurance contracts (by 3.0% and 4.8%, respectively).

In addition, interest in supplementary voluntary health insurance was observed. The number of contracts of this non-life insurance class increased more than three times in the first quarter of 2012, compared to the respective period last year (from 686 to 3,219).

In the first quarter of 2012, insurers paid claims for the total amount of LTL 255 million, or 1.8 per cent less than over the same period a year ago. The development trends of claims by insurance type diverged: in the first three months of this year, life assurance claims grew by 4.1 per cent to LTL 81.3 million, whereas non-life insurance claims declined by 4.4 per cent to LTL 173.7 million. The growth of life assurance claims paid was affected by the increase of traditional insurance claims by 71 per cent (to LTL 32.7 million). The decline in non-life insurance claims was determined by the contraction of the amounts of CASCO and property insurance claims paid.

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