After The 2005 Boost, The Insurance Business Have Slowed Down Its Growth Pace During The Last Six Months
The general insurance premium incomes for the first six months of 2006 come up to BGN 505. 024 million, registering an 8. 86% rise on an annual basis. These results were introduced by the Financial
Control Board report on the second third- month period. The results as well show that the market has slowed down its growth pace. The 2005 augmentation was by 40%. The decrease has been a tendency
through the years.
Notwithstanding the not so good results so far, the experts expect the total premium incomes to reach at least 15% by the end of the year, i.e. a turnover of some BGN 1 billion. The insurance
companies total incomes for 2005 amounted BGN 920 million. The compulsory MTPL insurance will again be determinative with its price and sales. The sales level is to reaches or even exceeds the span
which the state administration expects, and thus the total income amount is to rise too.
The market was as well dominated by vehicle insurance- Casco- and the compulsory Motor Third Party Liability insurance (including Green card insurance) which share comes up to 61.78%. When compared
to the results of last year, the share has diminished by 3. 17%, but the incomes have increased by BGN 10.21 million, i.e. 3. 65%. A few people were buying MTPL insurance last year, although it is
compulsory. The administration took measures and the sales rise is noticeable, the sales incomes have risen by 3. 25% for the first six months. The MTPL insurance price remained the same or was
slightly lowered, thus the compulsory insurance span is on the rise.
The second most major market segment is the property/dwellings insurance- Damage to Property insurance, Fire and Natural Disaster insurance. The sales of these insurance products make 21.87% of the
incomings for the first six months, registering a 3% rise, as compared to the same period of last year. These very two insurance policies sales have increased by BGN 30 million, registering a 25%
rise. The good results, however, are due to corporate clients purchases, not individual physical persons’.
The damages caused by the floods these recent years were covered by the national budget. Most citizens did not take any part in the restoration of the hit hard regions, that is why the government
decided to introduced the abolished years ago compulsory dwellings insurance.
While commenting on the insurance market results for the first half of the year, we should pay attention to the incomings increase of certain segments- Railway vehicles insurance, Vessels and
Watercraft insurance, Specialized Aircraft insurance.
The Disease insurance incomings have been dropping for years now. But Accident insurance, Aircraft insurance, Guarantees insurance and General MTPL insurance incomings have recently been
diminishing as well.
General insurance compensation payments made amount BGN 169. 203 million, registering a 16. 66% rise on an annual basis. The vehicle insurance relative share comes up to 81. 42% of all compensation
payments made.
Insurance companies assets, on general insurance, amount BGN 945. 018 million, registering a 20. 36% increase on annual basis. The technical reserve amount comes up to BGN 451. 473 million ,
registering a 41. 89% rise on an annual basis.
The premium incomes leader for the last six- month period remains the same- DZI General Insurance, with a market share of 17. 96%. The company premium incomes for the first six months amount BGN
90. 7 million, i.e. BGN 9 million less, as compared to the results of the same 2005 period.
Second, with a less than 1%, is Bulstrad Insurance Company , its premium incomes amount BGN 84. 3 million, i.e. BGN 2 million less, as compared to the results of 2005.
The third place is occupied by Allianz Bulgaria, with a market share of 14. 57%.
While the top companies remain the same, the other companies struggle for better results with varying success.
Orel Insurance Company occupied 9- 10th place last year and now it is placed 5th, while Lev Ins used to occupy the 5th position and is now placed 8th.
It would be reasonable to tell which are the most dynamically developing companies. It was already mentioned that the top insurers remain the same, registering lower incomes though. But there are
“smaller” companies which register amazing rises. Orel Insurance Company registers a 162. 84% incomes rise, as compared to the same period of 2005. The other two companies are Municipal Insurance
Company and Bulgarian Properties, registering rises of the respective 98% and 78%.
Beside the two leading companies, all the other insurers have concluded the period at a profit. The three companies with the highest profits are Allianz Bulgaria, Armeetz and Vitosha with the
respective BGN 8. 4million, 6 million and 4. 7 million.
Life Insurance
The life insurance premium incomes for the first six months amount BGN 82. 240 million, registering a 32. 18% rise on an annual basis. The life insurance market growth has as well slowed down its
pace, the 2005 incomes rise came up to 52%.
Insurance.bg prognostics read that notwithstanding the slower development pace the total annual incomes will exceed BGN 200 million.
Life insurance compensation payments during the first six month amount BGN 22. 151 million, registering a 31. 49% rise on an annual basis. Highest is the relative premium incomes share as well as
compensation payments share of the Life and Rent insurance product, with the respective 70% and 68. 24%.
Life insurance company assets amounted BGN 388. 808 million, by June 30th 2006, registering a 24. 59% rise on an annual basis. The technical reserves amount BGN 224. 850 million, registering a 35.
57% rise on an annual basis.
DZI is the premium incomes leader with a market share of 25. 81%. The second place is occupied by Allianz Bulgaria Life. The two companies are profitability leaders as well. Four companies have
market shares of some 9. 05%- 9. 72%. Bulstrad Life is placed third, Vitosha Life- fourth, Orel Life- fifth, AIG Life Bulgaria- sixth. The other seven companies hold 10. 74% of the market.
DSK Guarant was launched a year ago but it occupies the 8th place among the altogether 13 companies, ceding little to Grave Bulgaria which has not been present on the market for quite a
while.
Bulstrad Life, Vitosha Life and DSK Guarant have registered the highest incomes rise for the first six months.
The experts are unanimous that our life insurance market holds great short- term prospects. The major companies were monitoring the market and started doing business. There were ten licensed life
insurance companies in the spring of 2004. DSK Guarant was granted licence in 2004, Life Insurance Institute- in 2005, AIG Insurance and UBB- AIG Life- in 2006. Two other companies have applied for
licence and two other are expected to apply until the end of the year. So it is by no means impossible that the number of the life insurance companies will be equal to the number of the general
insurance companies in 2007, and be as well profitable within 15- 20 years.
