Bank of Lithuania: Insurance market reaches record volumes, although the rates of growth of insurance branches vary
OREANDA-NEWS. Bank of Lithuania: The insurance market recorded a year-on-year 6.4 per cent increase over the first half of this year in terms of premiums written, with its volumes reaching record heights — EUR 312.3 million.
“Growth in life assurance was less robust than a year ago, but this branch remains the main engine of growth within the entire insurance market. The non-life insurance market boosted as well, although the most numerous in terms of contracts concluded, motor third party liability (MTPL) insurance class did not avoid a decline”, says Mindaugas ?al?ius, Deputy Director of the Prudential Supervision Department of the Supervision Service at the Bank of Lithuania.
The record strong growth rate of life assurance a year ago (18.3%) slowed down in the first half of 2015, remaining double-digit though — 11.2 per cent. The amount of premiums written within this insurance branch was the largest in the entire data collection history — EUR 106.6 million. This change was mainly due to an increase (of 13.5%) in unit-linked life assurance, which accounts for 70 per cent of the entire life assurance market, while the amount of premiums was also record-large — EUR 74.6 million.
Year on year the non-life insurance market expanded by 4 per cent in the first half-year, while the amount of premiums written within it was EUR 205.7 million. Growth in the non-life insurance market was mainly driven by the Casco, property and health insurance classes, which expanded by 6, 10.8 and 15.5 per cent respectively. MTPL insurance, which accounts for the largest share of the non-life insurance market, recorded a 2.9 per cent decline (the amount of premiums written was EUR 68.3 million). Within this insurance class, a 1.1 per cent increase in the amount of premiums written by natural persons did not offset an 8.9 per cent decline in the premiums of legal persons.
Insurance undertakings registered in Lithuania incurred a EUR 16.4 million loss in the first half of 2015 (down from a year-on-year EUR 19.6 million profit). This result for the first half-year was mainly due to a one-off factor — a EUR 21 million loss, caused by the transfer of investments due to the transfer of the insurance portfolio of the Estonia branch of Codan Forsikring A/S, acquired by UAB DK PZU Lietuva in 2014. The impact of this transaction excluded, insurance undertakings would have earned EUR 4.6 million in profits.
In the first half-year, 97 insurance brokerage firms operated in Lithuania’s insurance market; they acted as intermediaries in concluding 744.8 thousand insurance contracts and pension accumulation agreements, an almost 9.8 per cent increase year on year.