E-CMPTL policies in Armenia have surpassed bar of 200 thousand  units; this is almost quarter of total number of contracts

ArmInfo. The number of vehicles with a compulsory motor third party liability insurance (CMPTL) policy in Armenia is gradually recovering its growth rates,  which allows the growth of fees to gain momentum.

So, according to the Motor Insurers' Bureau of Armenia,in January-November 2021,  their number increased by 8.3% per annum, with an exit from the 10.4%  decline a year earlier, but is still much inferior to the pre-COVID  rising rates of 14.2% for the same period in 2019.  And in terms of  quantity, in January-November of this year we managed to approach the  pre-COVID mark of 567,868 thousand units, against 584,820 thousand  units.

The renewed growth of the number of CMTPL contracts concluded is also  significantly lower than the Pre-COVID growth rates. Thus, in the  reporting period, the dynamics changed from a 13% decline to a 10.3%  growth, at the same time yielding sharply to the 26.2% growth  registered two years ago. As a result, in January-November of this  year, fewer CMPTL contracts were concluded than in the same pre-COVID  period - 899.949 thousand units against 1.046 million units. And the  volume of collected insurance premiums exceeded 19.6 billion drams ($  40.4 million), against the pre-COVID 20.5 billion drams. The average  insurance premium per CMPTL contract amounted to 21,839 drams in the  reporting period, with a reversal of the y-o-y dynamics from 11.8%  growth to 0.3% decline (against 5.8% decline in the same period  2019).

A similar growth by 10.1% (against a 22.3% decline a year earlier and  33.3% growth two years ago) was observed under the CMPTL agreements  that entered into force in the reporting period, amounting to  911,405. Under these contracts, the volume of insurance premiums  exceeded 20.3 billion drams ($ 41.8 million), resuming growth,  significantly lower than the pre-COVID rate - 9% against 19.3%. 

At the same time, the number of terminated CMTPL contracts continues  to grow significantly - 3.7-fold in January-November 2021 compared to  the same period a year ago, amounting to 78,023, while in 2019-2020  their number was rapidly decreasing. And the volume of returned or  refundable premiums has increased almost equally ( 3-fold), reaching  970.2 million drams ($ 2 million).

Against this background, sales of E-CMTPL policies remain high -  206,177 units, despite a slowdown in growth over the past two years  from 3.6-fold to 77.2%. As a result, the share of E-policies in the  total number of CMTPL contracts increased from the pre-COVID 5% to  the reporting 23%.

70,776 applications for insurance compensation were submitted in  January-November 2021, which is 16.1% more than a year ago (against a  13.8% decline a year earlier and a 15.9% growth two years ago).  And  the volume of payments on them amounted to 14.9 billion drams ($ 30.6  million), with a y-o-y growth of 13.7% (against a 7% decline a year  earlier and 11.6% growth two years ago). Moreover, 31,654  applications turned out to be in cases of simplified registration of  road accidents (according to the European protocol) with a y-o-y  growth of 26.4% (against the acceleration of the decline in the  previous two years from 4.2% to 17.1%), for which the volume of  compensations paid exceeded 3 billion drams, having increased by  66.7% on a y-o-y terms (against a 14.2-14.5% decline in the previous  two years), and the average size of one payment amounted to 95.980  thousand drams (with an acceleration of y-o-y growth from 3.1% up to  31.9%). As regards general insurance indemnities, the average size of  one payment decreased by 2.1% (against 7.9% growth in the previous  year), amounting to 210.288 thousand drams.

The loss ratio for CPMTL in January-November 2021 increased to 78%  from 63% in the same period of 2020, while there was a decrease from  73% to 72%. in the same pre-COVID period. 

In January-November 2021, by the same period of 2020, the number of  vehicles with a valid CMPTL agreement increased by 43.614 thousand  units. In particular, 4 insurance companies recorded an increase in  this indicator by a total of almost 53.7 thousand units, while the  remaining 2 insurance companies, on the contrary, had a decline by  10.1 thousand units. Moreover, the maximum reduction was observed in  Armenia Insurance - by 5.9 thousand units, and the largest increase  in Nairi Insurance - by 24.5 thousand units. Nevertheless,  Rosgosstrakh Armenia IC continues to be the leader in the number of  vehicles with a valid CPMTL policy - 170.363 thousand units (with a  y-o-y decline of 2.4% or 4.2 thousand units), the second place is  held by Nairi Insurance - 131.773 thousand units (with a y-o-y growth  of 22.8%), INGO Armenia is on the third place - 88.070 thousand units  (with a y-o-y growth of 11.3% or 8.9 thousand units), RESO -in the  fourth - 73.354 thousand units (with an annual growth of 17.6% or 11  thousand units), the fifth - Seal Insurance - 62.499 thousand units  (with a y-o-y growth of 17.5% or 9.3 thousand units), and  ArmeniaInsurance in the sixth place  - 41.809 thousand units (with  y-o-y decline of 12.3%).

Rosgosstrakh Armenia IC also holds the leadership in the share of  insurance premiums of 30.7% in the total volume of the market   (against 33.6% a year earlier), 31.83% -in the share of compensations   (against 32.6% a year earlier), and already covers 49.7% E-CMTPL  policies (versus 47.4% a year earlier). This company continues to  lead terms of the share of vehicles with a valid CMTPL policy - 30%,  despite a slight decrease from last year's 33.3%. Nairi Insurance  holds the second place in terms of these indicators: by the share of  insurance premiums - 23.5%, by the share of compensations - 19.39%,  by the number of E- CMTPL policies - 15.7%, by the share of vehicles  with a valid CMTPL policy - 23.2%. And the third place position is  taken by INGO Armenia - 15.2%, 13.69%, 12.6%, 15.51%, respectively,  in terms of premiums, compensations, E-policies, the number of  insured vehicles. The share of these indicators of the other three  insurance companies in the total market volume 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. In terms  of the largest number of classes, INGO Armenia is licensed - 16 (the  only one operating in the class of water transport insurance) and  Rosgosstrakh Armenia IC - 15. (The estimated exchange rate of the  dram to the dollar as of November 30, 21 was 486.28 AMD / $ 1).