Lithuania’s insurance market picked up by 1.3% in volume over three quarters of this year – insurance companies registered in the country and branches established in Lithuania by other European Union Member States wrote LTL 1.28 billion of insurance premiums.As in the previous quarters of this year, the extent of growth of written non-life insurance premiums outpaced significantly the volume of written life assurance premiums, which continued to contract.
“When analysing the reasons behind the contraction of the life assurance market, a sharp decline in the written premiums of one market participant the volume of whose activities accounts for a significant share of the life assurance market is observed. Such developments were driven by specific terms of its insurance product and adverse developments in the financial market. Without assessing the said market participant’s operating performance, the written premiums of other life assurance market participants increased in volume”, Mindaugas Šalčius, Deputy Director of the Prudential Supervision Department of the Supervision Service at the Bank of Lithuania comments.
39,967 life assurance contracts were concluded in January-September 2012 or 6.2 per cent fewer year on year. While the pace of contraction continues to be significant, favourable trends have been observed – the number of contracts concluded in the third quarter was higher than that in the first and second quarters as well as in the third quarter of 2011.
Over three quarters of 2012, 378.2 million life assurance premiums have been written. The trends in this market continue to be adverse, yet the pace of decline is slowing month by month – from 14.5 percent in January to 7.4 per cent in January-September. The premiums of life assurance related with investment funds which accounts for the major share of the market (67.8%) have been declining in volume further (12.5% over three quarters). The shrinking market share of this group is being replaced with the traditional life assurance share.
LTL 226.8 million of benefits have been paid out in the life assurance market over three quarters of 2012, LTL 5.8 million more year on year. The major proportion of benefits has been paid out under life assurance contracts related to investment funds (LTL 122.9 million).
The growth rate of non-life insurance contracts concluded over three quarters of 2012 continues to be similar to that over the respective period a year ago. 3.8 million units of non-life insurance contracts were concluded in January-September 2012, which is 3.0 per cent more year on year. During the reporting period, the number of contracts concluded increased across the non-life insurance groups, except in the surety insurance and the goods in transit insurance groups.
The results of written premiums in the non-life insurance market for three quarters of 2012 remain favourable and give grounds for optimism: the year-on-year growth of 5.4 per cent is observed. LTL 902.4 million of insurance premiums were written in the non-life insurance market in January-September.
Over three quarters of 2012, LTL 509.5 million of benefits have been paid out in the non-life insurance market, a decline of 10.3 per cent year on year.
The largest deviation of benefits for three quarters of 2012 year on year is within the property insurance group – 49.1 per cent or LTL 68.3 million. Without estimating crop insurance benefits, a decline in property insurance benefits of 17.9 per cent is observed.