First quarter – significant insurance market changes
In the first quarter of 2017 insurance market growth was three times stronger year on year. Insurance premiums amounted to EUR 184.7 million, an increase of 16 per cent year on year.
‘A significant increase in the premiums of transport insurance classes led to robust insurance market growth; however, the rate of insurance market claims paid outpaced that of insurance premiums. The growth in claims paid was driven by an increase of over 30 per cent in motor third party liability compulsory insurance claims paid and an increase of nearly 33 per cent in claims paid due to the termination of life assurance contracts or partial payment of an accumulated amount,’ Vytautas Valvonis, Director of the Supervision Service of the Bank of Lithuania, says.
The entire volume of the non-life insurance market expanded by 19 per cent; EUR 131.2 million in insurance premiums were signed. EUR 53.5 million of life assurance premiums were written in the first quarter of this year, an increase of 9.2 per cent year on year.
During the first three months of this year, insurance undertakings earned five times higher profits before tax (EUR 8.26 million) year on year. EUR 6.83 million of this amount was earned by life assurance undertakings and almost EUR 1.43 million by non-life insurance undertakings. The quarter was profitable for insurance brokerage firms as well, which earned EUR 1.8 million in profits, an increase of 83 per cent year on year.
At the end of March 2017, insurance undertakings managed assets amounting to EUR 1.4 billion, of which EUR 560 million belonged to non-life insurance undertakings. The assets of insurance brokerage firms stood at EUR 27.9 million at the end of March of this year, an increase of 15 per cent over the year.
All insurance undertakings complied with the solvency margin requirements: the solvency ratio of life assurance undertakings was 2.2, of non-life insurance undertakings – 1.6 (the required minimum is 1).
Since the beginning of the year until the end of March, 108 clients applied to the Bank of Lithuania regarding disputes with insurers – mainly over motor third-party insurance compulsory insurance and property insurance. The Bank of Lithuania settled 78 disputes and took 34 decisions. In one case, after the Bank of Lithuania’s decision, the insurer paid a claim equal to more than EUR 13 thousand.
In the first quarter of 2017, insurance services were provided by 20 insurers, of which 9 undertakings and 11 branches of undertakings registered in other EU countries. 98 insurance brokerage firms mediated insurers in concluding insurance contracts.