Monday, April 29 2019 14:46
Karine Melikyan

ArmInfo IC: In Armenia,  CMTPL loss ratio increased up to 64.5% in Q1  2019

ArmInfo IC: In Armenia,  CMTPL loss ratio increased up to 64.5% in Q1  2019

ArmInfo. The loss ratio  of compulsory motor third party liability insurance (CMTPL) in Armenia increased on average from 62.9% in the first quarter of 2018 to 64.5%  in the first quarter of 2019 (without deduction of reserves), and  according to the Bureau of Auto Insurers - from 71.1% to 73.7% (after  deduction of reserves).

According to the data of the Financial Ranking of Insurance Companies of Armenia, prepared by ArmInfo IC, the dynamics of premiums on CMPTL started to grow in the first  quarter of 2019 by 7.7% from a 2.1% decline in the first quarter of  2018, making 5.8 billion drams ($ 11.9 million ). The growth of  refunds accelerated from 11.2% to 12.3%, totaling 3.7 billion drams  ($ 7.6 million).

According to Finiancial Ranking of Insurance Companies prepared by  ArmInfo news agency, in CMTPL figures, Rosgosstrakh Armenia's  leadership in the market is maintained, which by April 1, 2019  ensured the insurance premiums amounting to 1.6 billion and  compensations in the amount of 1.1 billion drams, with a y-o-y growth  of these indicators by 6.5% and 22.5% respectively. INGO Armenia  holds th second place in terms of premiums of CMTPL- 1.5 billion  drams, while in terms of the volume of refunds, it occupies the third  position - 740.4 million drams. The third place is occupied by IC  "Nairi Insurance" - 905.7 million drams, keeping the second position  in terms of refunds - 804.5 million drams. The fourth position in  terms of insurance premiums and reimbursements of this class is  maintained by IC "Sil Insurance" - 730.03 million and 462.7 million  drams. Fifth and sixth positions in the CMTPL class are occupied by  IC "RESO" and IC "Armenia Insurance": insurance premiums - 599.1  million and 464.2 billion drams respectively, reimbursements - 284.6  million and 325.7 million drams respectively.  Out of the 6 insurance  companies operating in Armenia, in the first quarter of 2019 five  companies increased insurance premiums and compensations for CMTPL.  The largest y-o-y growth in premiums was ensured by INGO Armenia IC -  by 42%, while in refunds by Armenia Insurance IC- 37%. Only Nairi  Insurance recorded decline in CMTPL class premiums - by 25.1%, and IC  RESO in refunds - by 27.2%.  The loss ratio (without deduction of  reserves) also increased in health insurance - up to 25.8% on average  in the market for the first quarter of 2019 (against 25% a year  earlier). In terms of the full comprehensive insurance class the loss  ratio at the average for the I quarter of 2019 was at the level of  60% (without deduction of reserves), which is lower than the figure  for the same period last year (66.4%), while for the other classes  the loss ratio decreased in y-o-y terms more significantly. The zero  loss ratio was recorded in the first quarter of 2019 for liability  insurance from the use of air transport, which was observed also a  year earlier.  To recall, a lot of steps have been taken to improve  this market segment within 8 years since the CMTPL was introduced.  Since March 2016, the europrotocol mechanism has been implemented.  Since April 2017, a direct compensation mechanism has been  introduced, which turned out to be a core change in the CMTPL system.  From November 1, 2017, the ASWA system was launched - a single window  and a single platform for the insurance market, designed by the  Armenian Single Window for Automative project. From that moment on,  car owners were given a new opportunity - concluding a CMTPL contract  with any insurance company in on-line mode paying 5%less for an  insurance policy. From mid-December 2017, another tool was introduced  when in signing an insurance - accepting cash when paying for an  insurance policy through payment terminals with a cash-in function..   Thus, the process of introducing various possibilities for concluding  insurance contracts on CMTPL through the Single Window was completed  by the end of 2017. In parallel with this, discussions are continuing  with the Green Card Bureau on the process of possible membership of  Armenia in the system of international motor third party liability  insurance.  According to the information of Finranking of ArmInfo, 6  companies operating in the insurance market of Armenia out of 20  classes work on 18 (except for railway transport insurance and legal  and extrajudicial expenses insurance). Moreover, seismic risk  insurance (from earthquakes) has been involved since the beginning of  the current 2019 with licensing of all 6 insurance companies in this  class.

By April 1, 2019, the total volume of insurance premiums reached 16.5  billion drams, and the indemnities - 5.96 billion, with a y-o-y  growth of 17.4% and 4.3%, respectively. CMTPL and medical insurance  in terms of premiums and reimbursements hold the lead: CMTPL accounts  for 35.2% in premiums and 62.2% in reimbursements, and health  insurance - 40.7% and 28.4% respectively. 

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Марина Маньяваль
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