Wednesday, September 27 2017 16:28
Emmanuil Mkrtchyan

Successful business is forging for years - to the jubilee of IC "INGO Armenia"

Successful business is forging for years - to the jubilee of IC "INGO Armenia"

ArmInfoSuccessful business forges for years, leaving behind itself the difficult years of becoming. And from what principles were used as the basis of this process, what mission accompanied and guided the company in the process of its growth, this is the result of achieving a qualitative maturity. These days, INGO Armenia, one of the most successful insurance companies in the country, celebrates its 20th anniversary. And she began with the idea that appeared in a small company of like-minded people who decided to start an insurance business in the country in the classical sense. So was born in 1997, an insurance company called "Efes", denoting a medieval cold weapon with an obligatory attribute of security - a guard designed to protect the hand. For many years, the company was led by its co-owner Levon Altunyan, a medical student who apparently failed to deny the new Prime Minister Karen Karapetyan an invitation to head the Ministry of Health for the sake of major systemic changes in the field of national health. The company was headed by his youngest comrade, like-minded person who has worked in the company since the beginning of the 2000s, having studied at Cambridge University, Arevshat Meliksetyan. We asked him for a meeting to talk about the company's path, the situation in the insurance market and its prospects. The company you led was one of the first companies in the Armenian insurance market. And you joined her pretty early. Could you briefly describe the path that has been taken? After all, the market grew with great difficulties and huge numerical losses. How did "Ephesus" manage not just to survive, but by attracting a large strategic investor, to become a leading player in the market?

First a bit of history. The company "Efes" was registered in September 1997, having obtained the license of the insurance inspection of the Ministry of Finance of Armenia and thereby enlarged a large list of insurers, consisting of almost three dozen companies. This was the time when the legislative ordering of any commercial activity began in Armenia, laws were passed on LLC and Joint Stock Companies. But the insurance market itself was poorly regulated, and many companies were created as capped ones, I would say "pocket", and worked in the orbit of relatively large business structures that used insurance for their own commercial purposes by well-known at that time different financial schemes. We were not connected with anyone and the company went the other way, by becoming a classical independent business structure. 

When I joined the company while still a student at the Institute of National Economy, there were only 5 of us. Studying in the institute of insurance business and while working for the company, I fell in love with this work. She absorbed me all, it was very interesting, and I soon realized that I had connected this work all my life. I was one of the first, after me tens and dozens of young specialists came to us, and so the company began to develop its own corporate culture, inspired by its co-founder, Levon Altunyan, and supported by a desire for professional excellence. This was a very important circumstance, for it seems to me that it played a crucial role in the fact that out of a large number of existing insurers, the Russian insurance giant, Ingosstrakh, which decided to enter the Armenian market, in 2004 chose us quality, if I may say so, of the takeover object, acquiring a 75% stake in Efes and renaming it, according to its strategy, to INGO Armenia.

I remember that during these years the insurance market was shaking from time to time. Even HSBC Holding established its insurance company in Armenia, but after the first serious insurance event, it turned down its activities. Apparently, there was no faith in the market.

Initially, Ingosstrakh also came to Armenia after its customer, the investor - Siberia Airlines, which purchased our Armavia, and under Armenian law, only Armenian insurers had the right to insure aviation and other risks. But even before the deal with Ingosstrakh, Efes set itself an important task of meeting international standards, thanks to which the majority of the company's clients were Armenian representative offices of foreign companies, funds, international and diplomatic missions, which demanded a high level of service. We already had contracts for reinsurance coverage with a number of the largest reinsurance companies of France, Germany, companies - members of the London market "Lloyds". I think this fact helped also that the Russian investor paid special attention to us. In fact, if you remember, 2004 was called the year of the Russian financial assault in Armenia, marked by two major deals: Ingosstrakh bought Efes, and VTB Bank - Sberbank of Armenia. But soon the undeveloped Armenian insurance market faced serious challenges ... After the transfer of the functions of the financial mega-regulator in 2006, the subsequent adoption of a number of legislative amendments, regulatory decisions, including the increase of the minimum statutory capital stake, the market began to clear. After the adoption of the 3-on-account law on insurance, the market left about a dozen players. The process of consolidation continued, but at the same time in 2008, new players came to our market in the person of large Russian companies Rosgosstrakh and RESO-Garantia.

And, nevertheless, it was the major players that helped consolidate the market.

Shareholders of large companies had a direct interest in the absorption of small. The struggle was for every client. We, for example, purchased portfolios of five insurance companies - Fintrast, First Insurance, Griar Insurance, Alliance Flush and Cascade Insurance. And we believe that we have acquired not only a clientele, but also specialists, and people started working in our company who created the insurance market from scratch, they know him well, both professionally and, I would say, on an intuitive level. Today these people occupy top positions in INGO Armenia. 

And of course, the turning point in the development of the market was the adoption of the law on OSAGO, which gave a powerful impetus to the development of insurance culture and the market itself. So, with the adoption in 2011 of the law on compulsory motor third party liability insurance, our company has grown in size by 7 times. If before the law we worked a little more than 40 people, but now more than 280. We never saved our employees' training. We have 7 candidates of science, several people have graduated from major Western universities in the specialty of insurance, our employees teach in leading universities of the country. And, nevertheless, the company is young, the average age is 28 years, there are a lot of young people and we train it.

 

"INGO Armenia" is the market leader in the class of medical insurance. And all of us expect in the near future a new kind of compulsory insurance - medical.

 

We are now seriously preparing for the second key stage of market development - the introduction of CHI. The program of transition to MHI will be implemented in stages. First, from October 1 this year, civil servants will receive a social package, then citizens falling under the category of underprivileged and in the future, the timeframe has not yet been established, all other working citizens. We are insurers, we are aware that from the success of the first stage, the state will entrust us with the management of the second and third - full transition to the compulsory medical insurance.

Our analytics shows that "INGO Armenia" has the most diversified portfolio. How do you manage to keep the middle ground with such temptation as compulsory motor third party liability insurance (MTPL)?

The company's board of directors adopted a special decision limiting the CMTPL premiums to a 50% limit. All the rest is a well diversified portfolio of voluntary types, symmetrically disaggregated by property and medical insurance, car insurance (CASCO), liability insurance (professional), insurance of tourists leaving abroad. Actively working with banks, insuring property on mortgages, borrowers insure against accidents.

That is, do you manage to maximally diversify the portfolio in order to achieve moderate market risks?

Of course, we must have a balanced portfolio and we succeed. Otherwise, we may find ourselves in a zone of increased risks. You said about the important direction of corporate culture - the serious costs of training. I remember "Ingo Armenia" actively participated together with other companies in the training program for insurance mathematicians - actuaries. The demand for such specialists is formed in the market or is it too early? The need for such specialists is growing, certainly. Our work with universities has something to give, but it seems to me, while the return is incomplete. But there is a demand for actuaries - these are those experts who are important for us, who are counting the line of risk for which it is impossible to intervene. They also calculate tariffs, provide analytics, carry out technical analysis and give forecasts. Moreover, the Central Bank, by its force decision, ordered the company to have a staff of actuaries, they are responsible for both reserves and tariffs. Before any conclusion of a serious contract, we need to have an actuarial conclusion. This is correct, without it anywhere. However, in reality, despite a certain demand for such specialists, there is still little or no qualitative offer, or universities fail to cope, or people are leaving to work in another area. About why activists are needed, the development of a concept on CHI can serve as an example. Calculations for the Ministry of Health on these issues have been conducted by specialists from the insurance companies - actuaries since months 5-6, since the Ministry of Health itself was not in a position to do so.

Today much is said about agricultural insurance. INGO Armenia" tested this market a couple of years ago and came to the conclusion that the risks there simply go off scale, since the industry is completely unprepared for this.  You are right, the industry is completely unprepared and, secondly, there is no scale effect. A large  number of laws  does not work here yet, which means it is too early to talk about insurance of agricultural risks. The government and the market are thinking about this, thinking about how to prepare the industry for this service. But, at the same time, there is already a concept of insurance of dangerous objects. It's also about compulsory insurance. This document, on behalf of the government, is prepared by the Ministry of Emergency Situations and we help it in this. The bill is discussed, opinions are collected. I think not far off, when another type of compulsory insurance of dangerous objects will be adopted in Armenia.

Our company strives to be a locomotive in the further development of the insurance market. Having penetrated this idea, the whole staff of our employees lives and works. Thus, we are changing our country for the better and transferring our experience and our attitude to work from generation to generation. Only in this way, I'm sure, our company will dynamically and harmoniously conquer tops after tops.

Thank you for the interview, success and with the anniversary of you!

Related articles
 Friday, May 5 2017

ArmInfo.

 Thursday, April 13 2017

ArmInfo.

POST A COMMENT
Input digits     


News
Armenia counts on the beginning of construction of the second power unit of Yerevan TPP in the very near future
Nikol Pashinyan took part in work of 18th Forum of Union of IT Companies (UITE)
RA Ministry of Agriculture intends to continue and expand scope of cooperation with FAO
In the Ministry of Agriculture, EBRD presented Bank`s strategy and priorities for 2018-2019 in Armenia
Armenian Minister of Finance received head of Armenian office of European Bank for Reconstruction and Development
Fitch Affirms ACBA-Credit Agricole Rating at `B +` with Stable  OutlookFitch Affirms ACBA-Credit Agricole Rating at `B +` with Stable Outlook
Pobeda airline offers Rostov-Gyumri flight passengers a transfer to Yerevan
Armenia and Israel will not apply double taxation to business
Armenia`s share in customs duties distribution to increase within EAEU framework
The Armenian government will have the right to set other state tax rates
Armenian government intends to create equal conditions for producers and importers of brandy
Ambassador: Germany is ready not only to maintain current economic ties with Armenia, but also to take steps towards further cooperation.
Armenian government intends to complete all joint programs with IMF
EBRD is ready to assist Armenia, both in the energy sector and in the development of infrastructures
Lydian Armenia presented first annual report on Amulsar project
Beeline announces the improvement of the recruitment process
Armenian PM and Swiss Ambassador discussed issues related to development of Armenian-Swiss relations
BSRDB and Ameriabank signed second $15 million contract for SME loaning
Famous economist Acemoglu ready to help Armenia
Nikol Pashinyan is satisfied with trends of economic growth and positive economic expectationsNikol Pashinyan is satisfied with trends of economic growth and positive economic expectations
In the French Bordeaux, the Days of Armenian wine are held at the La Cite du Vin Museum
A. Javadyan: There was no significant outflow of capital from Armenia on the days of the protest movement. Early closure of deposits was observed in small amounts, but since May 10, a rapid recovery registered
More accessible calls to Artsakh for Beeline subscribers
The Ministry of Labor proposes to increase the lump sum at the birth of the second child from 50 to 150 thousand AMD
RA Ministry of Emergency Situations considers opportunities to expand cooperation with local IT companies
In August 2018, modernization program of operating power unit of Yerevan Thermal Power Plant to begin
A wool processing plant to be established in Amasia city of Shirak region
In Armenia, economic activity in Jan-April 2018 accelerated annual growth rates from 5.7% to 9.7%
Abashidze: Moscow and Tbilisi in Prague will discuss the possibility of creating "trade corridors" from Russia to Georgia and Armenia through Abkhazia and South Ossetia
American philanthropist of Armenian origin intends to invest $ 1 million in capital repair of school in Artsakh


Exchange rates
23.05.2018
RUB7.83-0.05
USD482.48-0.19
EUR565.61-5.15
GBP643.97-6.43
CAD374.65-3.77
JPY44.010.49
CNY75.660.01
CHF487.112.21

Experts
Mher Arakelyan:  Armenia`s payment business has great prospectsMher Arakelyan:  Armenia`s payment business has great prospects
Rating-Agentur Expert RA GmbH and AmRating issued an industry report  on Armenia`s banking systemRating-Agentur Expert RA GmbH and AmRating issued an industry report on Armenia`s banking system
Igor Nazaruk: Each planted sprout has the right to a successful prospect if it is cherished and taken care ofIgor Nazaruk: Each planted sprout has the right to a successful prospect if it is cherished and taken care of
Ara Khzmalyan: Armenia is comfortable to Russian touristAra Khzmalyan: Armenia is comfortable to Russian tourist
The Armenian delegation to the US followed the advice of President TrumpThe Armenian delegation to the US followed the advice of President Trump
Outflow of population and passivity of the Diaspora pushes property prices downOutflow of population and passivity of the Diaspora pushes property prices down
Finombudsman: Amendments to the Civil Code on the imposition of fines and penalties will reduce the number of outstanding loans and  non-creditworthy consumersFinombudsman: Amendments to the Civil Code on the imposition of fines and penalties will reduce the number of outstanding loans and non-creditworthy consumers
Vahan Shakaryan: If we promote Armenia, the promotion of economic sectors will not be a run with obstacles, but a light run for short distancesVahan Shakaryan: If we promote Armenia, the promotion of economic sectors will not be a run with obstacles, but a light run for short distances
Gagik Aghajanyan: There is no need to look for alternatives - it is necessary to work and develop actual   directionsGagik Aghajanyan: There is no need to look for alternatives - it is necessary to work and develop actual   directions
Vitaly Nesis: Armenia is very promising from the geological point of viewVitaly Nesis: Armenia is very promising from the geological point of view
The market of OSAGO goes into virtual spaceThe market of OSAGO goes into virtual space
Ishkhan Mkhitaryan: ArCa and Mir complete the technological part of the project of interaction, business for banksIshkhan Mkhitaryan: ArCa and Mir complete the technological part of the project of interaction, business for banks
The second stage of implementation of the program for prolonging the lifetime of the power unit N2 of the Armenian NPP beginsThe second stage of implementation of the program for prolonging the lifetime of the power unit N2 of the Armenian NPP begins
Successful business is forging for years - to the jubilee of IC Successful business is forging for years - to the jubilee of IC "INGO Armenia"
Armen Shahnazaryan: The double increase in the insurance portfolio of EIAA ICJSC by the end of 2018 is quite feasibleArmen Shahnazaryan: The double increase in the insurance portfolio of EIAA ICJSC by the end of 2018 is quite feasible
Expert: Real estate market of Armenia started demonstrating weak  signs of recovery in I half-yearExpert: Real estate market of Armenia started demonstrating weak signs of recovery in I half-year
Amulsar: Ecology and РeopleAmulsar: Ecology and Рeople
GeoProMining - ten years of work for the benefit of the country, at the forefront of gold miningGeoProMining - ten years of work for the benefit of the country, at the forefront of gold mining
SolarOn will become a catalyst for the development of solar energy in  ArmeniaSolarOn will become a catalyst for the development of solar energy in Armenia
Armenia fits well  for installation of container mini hydroelectric power stations, developed by RosatomArmenia fits well  for installation of container mini hydroelectric power stations, developed by Rosatom

Search by date

Government Bonds

 

ISIN AMGB1029A250
Auction ID AMGB1029A250A
Date 12.05.2017
Issue date 29.10.2015
Issue volume (AMD) 50 000 000 000
Maturity date 29.10.2025
Coupon year yield 11.00%
Auction volume (AMD) 1000 000 000 - 2.000 000 000
Auction date 12.05.2017
DLS
Total amount (AMD) 1 000 000 000
Amount of the total bids (AMD) 787 200 000
Amount of the total accepted bids (AMD) 787 200 000
Cut of yield (%) 10,6447
Weighted avrage yield (%) 10,6447
Auction max  yield (%) 10,6447
Auction min  yield (%) 10,6447
Number of participants 5
ArmEx

 

СПРОС (Покупка)

USD

Средневзв. Цена

482,00

ПРЕДЛОЖЕНИЕ (Продажа)

  USD

Средневзв. Цена

-

СДЕЛКИ

USD

Цена откр.

482,00

Цена закр.

482,00

Мин. Цена

482,00

Макс. Цена

482,00

Ср/взв. Цена

482,00

-0.16

Кол-во сделок

1

Объем (инвал.)

200 000

0бъем (драм)

96 400 000

Commented
Gyumri programmers won on hekaton Gyumri programmers won on hekaton "Innovative ideas for tourism development"
Armenian Lori opens a large international ski resortArmenian Lori opens a large international ski resort
A number of light and alcohol industry enterprises of Armenia will be  provided with state supportA number of light and alcohol industry enterprises of Armenia will be provided with state support
Expert: The attitude of Armenian public to the nuclear power industry is demonstrated not by the promiseExpert: The attitude of Armenian public to the nuclear power industry is demonstrated not by the promise
Expert: The biggest gap in procurement legislation is the lack of an institution for accountability for its violationExpert: The biggest gap in procurement legislation is the lack of an institution for accountability for its violation
Maxim Sokolov: Russian Federation remains the main trade partner of  ArmeniaMaxim Sokolov: Russian Federation remains the main trade partner of Armenia
Russian MP: Restoring railway communication between Armenia and  Russia through Abkhazia and Georgia meets the economic interests of  Yerevan and MoscowRussian MP: Restoring railway communication between Armenia and Russia through Abkhazia and Georgia meets the economic interests of Yerevan and Moscow
Amulsar program was awarded a certificate of compliance with ICMC standards in pre-production cycleAmulsar program was awarded a certificate of compliance with ICMC standards in pre-production cycle
Expert: Subsidizing is the worst model of softening the results of price increaseExpert: Subsidizing is the worst model of softening the results of price increase
Fitch improved outlook on Yerevan`s rating from Fitch improved outlook on Yerevan`s rating from "Stable" to "Positive"
Expert: Energy component of the Armenia-EU agreement conceals big threats for ArmeniaExpert: Energy component of the Armenia-EU agreement conceals big threats for Armenia
Armenian Energy Ministry raises permissible threshold of autonomous  generation of electricity on the basis of RES to 500 kW / hArmenian Energy Ministry raises permissible threshold of autonomous generation of electricity on the basis of RES to 500 kW / h
Beeline hosted the largest this year`s "Client`s Day"
Armenian Deputy Energy Minister urged ECC members to pay more  attention to climate change and greenhouse gas emissionsArmenian Deputy Energy Minister urged ECC members to pay more attention to climate change and greenhouse gas emissions
Compensation for OSAGO shows an impressive annual increase Compensation for OSAGO shows an impressive annual increase
In Armenia, imported electric vehicles will be exempt from all types of taxesIn Armenia, imported electric vehicles will be exempt from all types of taxes
David Lokyan: The volume of own incomes of Armenian communities will grow by 10%David Lokyan: The volume of own incomes of Armenian communities will grow by 10%
Human Rights organization Human Rights organization "Driver`s Friend": ban on right-hand drive cars - nothing more than a regular business project
In Q1 2017 foreign investments in the volume of $ 1 billion were  received to the real sector of Armenian economy  with annual growth  of 36.6%In Q1 2017 foreign investments in the volume of $ 1 billion were received to the real sector of Armenian economy with annual growth of 36.6%
Ameriabank is awarded Euromoney Award for Excellence 2017 as Best  Bank of the Year in ArmeniaAmeriabank is awarded Euromoney Award for Excellence 2017 as Best Bank of the Year in Armenia
Chinchilla fur factory will be established in ArmeniaChinchilla fur factory will be established in Armenia
Narek Sargsyan: Southern Avenue constructions are planned to be started this fall in the capital of ArmeniaNarek Sargsyan: Southern Avenue constructions are planned to be started this fall in the capital of Armenia
Thanks to cooperation between VivaCell-MTS and Fuler House-Building Center, 146 families in Armenia received housesThanks to cooperation between VivaCell-MTS and Fuler House-Building Center, 146 families in Armenia received houses
Armenian Ministry of Economy Development and Investment promises to drive the country`s  export extent of GDM to 45% in 5 yearsArmenian Ministry of Economy Development and Investment promises to drive the country`s  export extent of GDM to 45% in 5 years