Insurance premiums in January 2014 rose to around 990 million lek (Euro 7 million), up 31 percent compared to January 2013 while paid claims reached 201 million lek (Euro 1.4 million), up 18 percent year-on-year
TIRANA, Feb. 25 – Albania’s insurance market rose by 31.5 percent in January 2014 fuelled by a sharp increase in compulsory auto insurance rates. Data published by the Financial Supervisory Authority show compulsory motor insurance premiums rose by around 30 percent to 374 million lek (Euro 2.6 million), accounting for 44 percent of the market share compared to 45.6 percent in January 2013.
The market registered growth despite the number of insurance policies dropping by 11.2 percent compared to January 2013 and the amount of paid claims increasing by around 18 percent.
Insurance premiums in January 2014 rose to around 990 million lek (Euro 7 million), up 31 percent compared to January 2013 while paid claims reached 201 million lek (Euro 1.4 million), up 18 percent year-on-year.
The increase is a result of compulsory auto insurance trading at an average of 13,000 lek (Euro 91), double compared to January 2012.
All insurance companies were forced to reduce prices last weekend in order to maintain their market shares after INSIG cut rates by around 20 percent to 16,000 lek (Euro 112). INSIG’s market share in the compulsory motor insurance dropped to 6.14 percent in 2013, down from 7.41 percent in 2012, according to the Financial Supervisory Authority.
The market shrink in 2013 seems the reason behind the increase in motor insurance rates in early 2014. Affected by a double-digit decline in compulsory motor insurance, the insurance market shrank by 4.6 percent in 2013, registering the first decline in the past five global crisis years.
Data published by the Financial Supervisory Authority show insurance premiums in 2013 dropped by 4.63 percent to 8.5 billion lek (Euro 60 million), affected by a 15.5 percent decline in compulsory motor insurance premiums, which account for around 40 percent of the market share.
Paid claims in 2013 also dropped by 3.3 percent to 2.7 billion lek (Euro 19 million).
The market share of compulsory motor insurance premiums dropped to 36.5 percent in 2013, down from 42 percent in 2012.
Albania’s insurance market rose by 7.8 percent in 2012, by 1.8 percent in 2011, 4.17 percent in 2010 and by 11.3 percent in 2009 soon after the outbreak of the global financial crisis.
Some nine insurance companies operate in Albania, of which only INSIG remains wholly state-owned following unsuccessful privatization attempts.
The Albanian insurance market, dominated by two Austrian insurance groups, is overwhelmingly non-life oriented with around 87.7 percent while voluntary insurance accounts for 54.2 percent of total insurance premiums.
