Friday, September 24 2021 16:35
Karine Melikyan

Growth of vehicles with CMTPL insurance resumes in Armenia and an  upward trend in fees has been outlined

Growth of vehicles with CMTPL insurance resumes in Armenia and an  upward trend in fees has been outlined

ArmInfo. The growth of vehicles with CMTPL (compulsory motor third party liability policy) resumed in Armenia. And as evidenced by the data of the Bureau of  Motor Insurers of Armenia, their number increased in January-August  2021 by 1% per annum, with an exit from the 2.9% decline a year  earlier, but so far it is much inferior to the pre-covid upward rate  of 13% for the same period in 2019.

However, in quantitative terms in  January-August of this year it was almost managed to restore the  pre-covid threshold - 556,082 units against 567 483 units.  The  resumed growth in the number of CMTPL contracts concluded also  significantly yielded to the pre- covid upward rates. Thus, during  the reporting period, the dynamics came out of the 16.8% decline to  5.6% growth, while being strongly behind the 34% growth two years  ago. As a result, in January-August of this year fewer CMTPL  contracts were concluded than in the same pre-covid period - 633 805  units against 721 821. And the volume of insurance premiums collected  on them exceeded 13.9 billion drams ($ 28.2 million), with the  release of the annual dynamics from 8.2% decline to 7% growth, much  inferior to the pre-covid upward 25.2%. The average amount of  insurance premium per one CMTPL contract amounted to 21,929 AMD in  the reporting period, slowing down the annual growth from 10.4% to  1.3%.  A more modest growth was outlined by the compulsory motor  third party liability insurance contracts that entered into force in  the reporting period - 4.7% (against a 16.9% decline a year earlier  and a 33% growth two years ago), amounting to 646,332. The amount of  insurance premiums on these contracts totaled 14.6 billion drams ($  29.7 million), resuming growth, but at a rate inferior to the  pre-covid threshold- 5.2% against 16.2%.

However, there is a significant increase in the number of terminated  CMTPL contracts - 3.9-fold in January-August 2021 compared to the  same period a year ago, amounting to 43 658, while in 2019-2020 their  number was rapidly decreasing. The volume of returned or subject to  return premiums has increased almost as much-3 -fold, reaching 544.5  million drams ($ 1.1 million).

Against this background, the high activity of sales of E-CMTPL  policies remains -135,188, despite the slowdown in growth over the  past two years from 3.6 -fold to 63.5%. As a result, the share of  E-policies in the total number of MTPL contracts increased from a  pre-covid  5% to a reporting 21%.

50 375 applications for insurance compensation were submitted in  January-August 2021, which is more than a year ago by 14.8% (against  a 12.4% decline a year earlier). And the volume of payments on them  exceeded 10.8 billion drams ($ 22 million), with an annual growth of  13% (against a 4.1% decline a year earlier). Moreover, 23,362  applications turned out to be in cases of simplified registration of  road accidents (according to the European protocol) with an annual  growth of 32.5% (against a 24.1% decline a year earlier), for which  the volume of compensations paid exceeded 1.8 billion AMD, having  increased on an annual basis by 46.2% (against 28.3% decline a year  earlier), and the average amount of one payment - 78.282 thousand  drams (with the release of the annual dynamics from the 5.5% decline  to 10.3% growth).  As for general insurance indemnities, the average  amount of one payment decreased by 1.5% (against 9.4% growth in the  previous year), amounting to 215.019 thousand drams.

The loss ratio for CMTPL increased in January-August 2021  to 79%  from 61% in the same period of 2020, while less noticeably exceeding  the pre-covid 72%.

In January-August 2021, by the same period of 2020, the number of  vehicles with a valid CMTPL agreement increased by 5,239 thousand  units. In particular, 3 insurance companies recorded an increase in  this indicator by a total of almost 28 thousand units, while in case  of the remaining 3 companies, on the contrary, the indicator declined  by 23 thousand units. Moreover, the maximum reduction was observed in  Rosgosstrakh Armenia - by 14.2 thousand units, and the largest growth  was observed in Nairi Insurance - by 16.7 thousand units.  Nevertheless, Rosgosstrakh Armenia IC continues to be the leader in  the number of vehicles with a valid CMTPL policy - 166.610 thousand  units (with an annual decline of 7.9%), the second position is held  by Nairi Insurance - 128,008 thousand units (with an annual growth of  15%), INGO Armenia ranks third - 89,052 units (with an annual growth  of 6% or 5 thousand units), on the fourth - RESO - 71.803 thousand  units (with an annual growth of 9.7% or 6.3 thousand units), the  fifth - Sil Insurance - 56.405 thousand units (with an annual decline  of 3.5% or 2 thousand units), and the sixth - Armenia-Insurance -  44.204 thousand units (with an annual decline of 13% or 6.5 thousand  units).

Rosgosstrakh Armenia IC also holds the lead in the share of insurance  premiums in the total volume of the market - 30.2% (against 33.4% a  year earlier), in the share of compensations - 32.06% (against 32.02%  a year earlier), and already over 51% covers E-CTPL policies (against  46.6% a year earlier). This company continues to occupy a leading  position in terms of the share of vehicles with a valid CTPML policy  - 29.96%, despite a slight decrease from last year's 32.82%. IC  "Nairi Insurance" holds the second position in terms of these  indicators: by the share of insurance premiums - 23.3%, by the share  of compensations - 18.71%, by the number of E-CMTPL policies - 14.7%,  by the share of vehicles with a valid MTPL - policy - 23.02%. And the  third position is taken by INGO Armenia IC - 15.6%, 13.55%, 12.7%,  16.01%, respectively, in terms of premiums, compensations,  E-policies, the number of insured vehicles. In case of the remaining  three insurance companies, the share of these indicators in the total  market is much smaller.  It should be noted that there are 6  insurance companies operating in Armenia, out of the available 20  classes of 17, with the exception of insurance of railway transport,  liability from the use of railway transport, insurance of judicial  and extrajudicial expenses. The largest number of classes is licensed  by IC "INGO Armenia" - 16 (the only one operating in the class of  water transport insurance) and IC "Rosgosstrakh Armenia"- 15. (The  estimated exchange rate of the dram to the dollar as of August 31 was  493.12 AMD / $ 1). 


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