TIRANA, March 1 – Albania’s insurance market dropped by about 14 percent last January when the tax rate on insurance premiums was raised by 7 percent to 10 percent.
Insurance premiums in the market dominated by compulsory motor insurance dropped by 13.85 percent to 1 billion lek (€7.2 million) as the number of insurance policies fell by 3 percent to 72,134 compared to January 2015, apparently affected by a price increase.
Starting Jan. 2016 the tax on insurance premiums expect for life, travel health and Green Card motor insurance, has increased to 10 percent, up from a previous 3 percent, affecting compulsory motor insurance which accounts for two-thirds of the market. Insurance operators have warned the tax hike will be reflected on high insurance policy rates.
Paid claims in January 2016 were also down by 7.5 percent to 610 million lek (€4.3 million).
Albania’s non-life and compulsory insurance oriented insurance market grew by 21 percent in 2015 and by 36 percent in 2014 after a 4.6 percent annual decline in 2013.
Some ten insurance companies operate in Albania, of which only INSIG remains wholly state-owned following unsuccessful privatization attempts.
