Strong insurance market growth maintained by non-life insurance sector
The amount of insurance premiums written by insurance undertakings registered in Lithuania and branches of undertakings of other European Union countries during the three quarters of 2016 was more than 7 per cent higher year on year and stood at EUR 498 million – which is the best result over the last ten years.
‘The market has been moving forward rapidly not due to the development of the non-life insurance sector – within it, the premiums of vehicle insurance classes traditionally grew the most. The drop in the life assurance branch was due mainly to a fairly significant decline in the volume of single life assurance premiums. The fluctuations in it are particularly unsteady and have been affecting the size of the life assurance portfolio to a great extent,’ says Vytautas Valvonis, Director of the Supervision Service at the Bank of Lithuania.
The drop in single insurance premiums by more than EUR 10 million or 45.5 per cent over the year was not offset by a nearly 5 per cent-increase in periodic life assurance premiums. The total amount of life assurance premiums in January–September this year was EUR 153.3 million, a year-on-year decline of almost 3 per cent. Non-life insurance premiums reached EUR 344.6 million at the end of the third quarter this year, a more than 12.6 per cent increase year on year.
Insurance undertakings registered in the country earned EUR 6 million in profits over the initial three quarters of this year; the results of the branches of insurance varied though: profits of life assurance undertakings amounted to EUR 13.9 million (EUR 6.7 million during the same period last year), while non-life assurance undertakings incurred a loss of EUR 7.9 million. The total loss within the non-life insurance branch was driven by the restructuring or reorganisation processes in two undertakings. Their capital was strengthened to offset this loss, hence all insurance undertakings are solvent and meet the requirements of legal acts.
Insurance brokerage firms providing mediation services earned EUR 3.6 million in profits in January–September this year. This is their best financial result in over the last three years.
21 insurers registered in Lithuania were entitled to provide insurance services in the domestic market at the end of the third quarter of 2016: nine undertakings and twelve branches of undertakings registered in European Union countries. Eight of them were engaged in life assurance activities and 13 in non-life insurance activities. 97 insurance brokerage firms mediate insurers in concluding insurance contracts.
The full Review of Lithuania’s Insurance Market for the Three Quarters of 2016 (384.5 KB download icon)and financial statements are available on the website of the Bank of Lithuania.