Global financial crisis will affect Russian insurance market in 2009
In 2009 Russian insurance companies aren't likely to post a rapid increase in premiums due to the global financial crisis, said Ilya LOMAKIN-ROUMYANTSEV, head of the Federal Service for Insurance Supervision (FSIS), on October 9 at the press conference "Insurance Market: Public Policy and New Development Frontiers."
LOMAKIN-ROUMYANTSEV believes that insurers have to take into account the possible premium decrease of up to 25-30% when drawing development plans for the next year. He estimated that in the worst-case scenario the market may see a 50% drop in premiums.
Vladimir SKVORTSOV, CEO of ALFA STRAKHOVANIE Group, pointed out that, according to his company's worst-case forecast, the Russian insurance market may rise 5% compared to the 2008 figure. According to SKVORTSOV, in this scenario the life and accident insurance segments will show a decline in premiums. The volume of written premiums won't change in such segments as marine, liability, cargo, commercial and residential property, and mortgage insurance. The amount of premiums is predicted to grow in only three segments: compulsory MTPL, voluntary health, and traveller insurance.
According to the more optimistic forecast compiled by ALFA STRAKHOVANIE, the Russian insurance market will post an 18% growth in 2009. Mortgage insurance premiums will rise by 30%, life and private property premiums by 22%, compulsory MTPL premiums by 21%, and health and traveller insurance premiums by 16%. Some other segments will show a less essential growth of premiums: accident insurance by 6%, marine, liability and cargo insurance by 4%, and commercial property insurance by 5%.
"There is an urgent need to take some actions to maintain balance in the industry and to stimulate the market. Among possible measures to be taken are review of insurers' solvency in crisis conditions, putting a limit on operations of underreserved companies, and financial support for major market players," SKVORTSOV believes. by RP Newsline
