Bank of Lithuania
2017-04-18
  • Fotolia_101884972_Subscription_Monthly_M.jpg
     
1 of 1

With an increase of one-tenth in the insurance market in terms of premiums in 2016, insurance undertakings registered in the country earned EUR 6.5 million in unaudited profits. However, the results diverged across insurance branches: life assurance undertakings earned EUR 19.8 million in profits, while non-life insurance undertakings suffered EUR 13.3 million in losses.  

‘The year 2016 was a success for all five life assurance undertakings –  their operations were profitable. Meanwhile, of the four undertakings engaged in non-life insurance, two operated at a loss, leading to the overall loss for non-life insurance undertakings. Their financial performance was affected by the reorganisation or restructuring processes that were under way. Over the last three years, insurance broker companies providing mediation services enjoyed the highest profits,’ said Vytautas Valvonis, Director of the Supervision Service of the Bank of Lithuania. 

Insurance brokerage firms earned EUR 4.3 million in profits last year. This result was due to a 14.9 per cent increase (to EUR 41 million) in undertakings’ income from sales. The majority of insurance brokerage firms operated profitably.  

Nine insurance undertakings providing insurance services in Lithuania and eleven branches of insurance undertakings registered in other EU countries wrote EUR 709.8 million in insurance premiums in 2016. This is the largest amount of premiums written over the last ten years. The amount of premiums from the non-life insurance sector, which maintained growth throughout the year, grew by 13.2 per cent from 2015, while those from the life assurance sector, having boosted significantly towards the end of the year – by 4.6 per cent. 

The assets managed by insurance undertakings amounted to EUR 1,399 billion at the end of 2016. This indicator rose by 18.7 per cent over the year and mostly pertains to the end of the restructuring process at ADB Gjensidige, when this insurance undertaking, operating in Lithuania, carried out a merger with an undertaking operating in Latvia.  

All insurance undertakings met solvency margin requirements. After calculating capital requirement and evaluating the amount of own funds available according to Solvency II requirements it has been established that all insurance undertakings were solvent, i.e. held sufficient own funds to satisfy increased capital requirements. According to the submitted data as of 31 December 2016, the solvency ratio of non-life assurance undertakings was 1.7, of life assurance undertakings – 2.2.

Given that financial accounting standards changed as of 1 January 2016, the performance of insurance undertakings registered in Lithuania is not comparable to the previous period.

Detailed data on the domestic insurance market performance is available on the Bank of Lithuania website.