ArmInfo.The total net profit of insurance companies in Armenia in the first half of 2020 jumped 4.4 times against the same period last year (against 71% growth a year earlier), exceeding AMD 3.3 billion or $ 6.9 million.
According to the Financial Rating of Armenian Insurance Companies, prepared by IC ArmInfo, the acceleration of the growth of this indicator was observed against the background of the reversal of the dynamics of insurance premiums and compensations from 18.7-16.5% growth towards 7.7-7% decline. And this is the result of the fact that the majority of insurance companies recorded a deterioration in the dynamics of premiums, with three entering a decline, and the other three with a significant slowdown in growth, and the same picture was observed in claims, but with a decline in only two insurance companies. It should be noted that the second quarter fell on the extended period of the State of Emergency (from March 16 to August 13) due to the coronavirus pandemic, during which many types of economic activities were temporarily prohibited in the first two months and only from May 18 the ban was lifted , but so far the activity of international air, rail, and bus communication is limited, and the activities of catering and services have only partially resumed.
On a quarterly basis, the net profit of insurers maintained high growth rates, but with a slight slowdown from 3.5 times in the first quarter to 2.6 times in the second quarter, while a year earlier there was an acceleration of the upward quarterly trend from 3 times to 4 times ... And this was observed against the background of a more impressive deterioration in the reporting quarter of the dynamics of premiums from 27.1% growth to 47.9% decline, rather than compensations, which also reversed the trend from 3.9% growth to 23.9% - th recession. As a comparison, we note that in Q2 2019 the deterioration in the dynamics of premiums was similar - from 59.8% growth to 42.1% decline, and the trend of refunds, on the contrary, showed a way out of the 7% decline to 0, 3% growth.
The first place in terms of net profit for the first half of 2020 was taken by INGO Armenia IC - 968.4 million drams (an annual growth of 4.6 times). IC "Armenia Insurance" moved up to the second place with a profit of 894.3 million drams (annual growth of 7.7 times), displacing the former leader - IC "Nairi Insurance" - to the third position with a profit of 831.7 million AMD (annual growth of 2 times). IC "Rosgosstrakh Armenia" moved up to the fourth place with a profit of 386.8 million drams (an annual growth of 5.5 times, with an exit from the loss), displacing the IC "RESO" to the fifth position with a profit of 198.9 million AMD (annual growth of 75.5%). And the list of ICs is closed by the level of net profit of IC "Seal Insurance" - 64.7 million drams (annual growth by 2.2 times).
The decline in premiums and indemnities reduced the profit on the insurance line in the first half of 2020 by 8.3% per annum - to 12.4 billion drams, against an increase of 20.6% a year earlier. Moreover, only in the second quarter of 2020 this indicator decreased impressively - by 64.6%, having moved down from 50.7% growth in the first quarter, which was observed at a more significant pace in 2019 - from 2.8 times in Q1 to 67.3% decline in Q2. Insurance profit for the first half of 2020 was the leading one for IC "INGO Armenia" - 3.7 billion drams (reversal of annual dynamics from 72.6% growth to 23.8% decline), in second place - IC "Rosgosstrakh Armenia" "- 3.5 billion drams (slowdown of annual growth from 4% to 0.2%), and the third position was held by IC" Nairi Insurance "- 2.1 bln AMD (reversal of the annual trend from 32.8% decline to 33.5% growth). The decline of this indicator appears in four insurance companies - 4.7- 32.2% (maximum for IC RESO), and growth for two - 0.2-33.5% (maximum for IC Nairi Insurance). It should be noted that 6 companies operate in the insurance market of Armenia, which out of the available 20 classes of insurance operate in 17, except for insurance of railway transport and liability from its use, insurance of judicial and extrajudicial expenses. Since the second quarter of 2020, the insurance class for agricultural risks has been added to the IC reports, but it is not added to the final indicator, since it is taken into account in two other types of insurance: property against fires and natural disasters; property from other damages. In terms of the largest number of classes, INGO Armenia IC is licensed - 16 and Rosgosstrakh Armenia IC - 15. (The estimated exchange rate of the dram to the dollar as of June 30, 2020 was 482.36 dr.
