Latest data by the Financial Supervision Authority indicates 5.33 percent decline in revenue, 70 percent increase in claims paid, January to January.
Andi Balla
TIRANA, March 14 – Insurance market revenues in Albania declined in 2009, while the numbers of claims paid went up, according to the latest by the Financial Supervision Authority.
The date indicates a 5.33 percent decline in revenue and a 70 percent increase in claims paid, January to January.
Albania’s insurance market lost some of the financial strength it had gained last year. Gross written premiums reached the about 634 million leks in January 2010 or 5.33 percent less than January 2009, according the AMF, as the authority is known in Albanian.
The number of insurance contracts signed over in January 2010 was 41,309, marking a decrease by 25.08 percent compared to January 2009.
Experts say the reasons behind the decline are related to the negative effects of the global economic crisis.
According the AMF, the market continued to be non-life oriented, a category that constitutes about 91.26 percent of the overall premium volume, thus leaving life insurance with a share of about 8.74 percent. From the point of view of market structure, according to compulsory and voluntary insurances, gross written premiums from voluntary insurance constitute 55 percent, while compulsory insurance premiums 45 percent of the market premiums.
The growth in voluntary premiums has impacted the change of the market structure with the voluntary insurance gaining importance.
During January 2010, gross written premiums in compulsory insurance had decrease of 19.51 percent compared to the same month last year.
Compulsory vehicle insurance gross written premiums were about 286 million leks or 19.51 percent less compared to the same period in 2009.
Gross written premiums in border insurance increased by 32.36 percent in January 2010, while the number of contracts increased by 21.59 percent compared with January 2009.
Within the recent few years, the insurance market improved its structure in favor of voluntary insurance, which during January brought 55 percent of the overall insurance premiums. Voluntary insurance premiums reached about 349 million leks, or 10.6 percent more than January 2009 and by about 42.69 percent decrease in the number of insurance contracts compared to the same period a year earlier.
Non-life voluntary insurance revenues increased by approximately 18.5 percent compared to January 2009.
In the property, liability and suretyship portfolios, which had with about 220 leks in total revenues, 61.6 percent of gross revenues were recorded in fire and damage property insurance, followed by general civil liabilities insurance with 25 percent and suretyship with 8.17 percent.
The Fire and Additional Risks portfolio experienced a decrease in the insurance contracts of about 2.8 percent and a decrease of about 93.23 percent in gross written premiums.
In January 2010, liability insurance had an increase of about 39.42 percent compared with January 2009. Engineering insurance, when analyzed separately over this period, experienced an increase by 21.90 percent in gross written premiums, despite a 52.38 percent decrease in the number of contracts compared to the same period of prior year.
Personal accidents and health insurance premiums in January 2010 amounted to about 28 million leks, marking a decrease of about 3.43 percent compared to the same period of 2009. The highest percentage here was taken up by the Travel Health Insurance category with about 67.81 percent of this group’s revenue.
The number of auto accidents in Albania increased, despite the fact the Albanians paid less for insurance premiums in 2009.
The increase in total gross claims paid was about 69.33 percent compared to January 2009. The major amount of paid claims belongs to motor insurance with 132 million leks or 87.42 percent of the total paid claims.
The adoption of the compulsory insurance law in the transport sector in early 2009 and the respective bylaws are expected to improve the handling procedures and increase the overall quality of service toward the insurance policyholders.
When looking at the average claim within the classes of the motor insurance, since this type of insurance accounts for most of the increase in the claims paid, the authority observes that there has been an increased in the Casco and Green Form insurance claims.
