Insurance market registers first decline in past five crisis years

TIRANA, Jan. 23 – 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.
Albania’s Competition Authority has launched an enquiry into the insurance market over an alleged price-fixing deal which is alleged to have limited competition in the compulsory motor insurance policies.
Some nine insurance companies operate in Albania, of which only INSIG remains wholly state-owned following unsuccessful privatization attempts.
The Albanian insurance market is overwhelmingly non-life oriented with around 87.7 percent while voluntary insurance accounts for 54.2 percent of total insurance premiums.