Insurance market up 7.8% in Jan-July

TIRANA, Aug. 30 – New insurance premiums during the first seven months of this year climbed to around 5.2 billion lek (Euro 37 million), up 7.8 percent compared to the same period last year, says the Financial Supervisory Authority in its latest report.
The number of insurance policies issued during January-July 2011 doubled to 756,821. The market continued remaining non-life oriented with around 88 percent of the total premiums, leaving life insurance with a 12 percent share. Voluntary insurance premiums accounted for a majority of 55.5 percent compared to 44 percent for compulsory insurance.
Compulsory motor insurance premiums dropped to 2.3 billion lek, down 5.85 percent compared to the first seven months of 2010.
Personal accidents and health premiums during the first five months of this year reached 586 million lek, registering an increase of 153 percent year-on-year. Health insurance premiums accounted for around 90 percent of revenues within this group. The considerable increase is also a result of the visa liberalization regime Albania has been enjoying since mid-December 2010, which significantly raised compulsory insurance purchases during trips abroad.
Gross paid claims during January-July grew by 6.72 percent to 1.26 billion lek. The majority of them, some 79 percent of the total, belong to motor insurance.
According to the Financial Supervision Authority, Albania continues to be one of the countries with the lowest annual consumption per capita of insurance. Albanians pay on average 20 dollars annually for compulsory and voluntary insurance of vehicles, as well as property and life insurance– a small amount compared to other European countries.
The region of Tirana, where around one-third of the country’s 3.2 million population lives and most businesses operate, accounts for more than 60 percent of the insurance market in Albania, according to a 2010 report published by the Financial Supervisory Authority. The report on Albania’s insurance geography shows the region of Tirana, which includes the districts of Tirana and Kavaja constitutes 61.17 percent of the insurance market.
A recent government decision to liberalize car insurance premiums has been welcomed by insurance companies operating in the country who say that the market will now liberalize and services will improve. Insurance companies used to operate under fixed rate premiums which cannot be lower than 11,000 lek annually set by the Finance Ministry.