MTPL contracts show 81.8% loss ratio in 2024 

ArmInfo.In the insurance market of Armenia, the loss ratio for MTPL for 2024 increased from 71.7% to 81.8%. This is evidenced by the data of the Bureau of Motor Insurers of Armenia.

The growth of the ratio in 2024 was observed against the background  of a deterioration in the annual dynamics of the number of active  contracts - from 11.7% growth to 0.7% decline, a moderate  acceleration in the growth of insurance premiums - from 2.9% to 9.3%,  in parallel with which a pronounced acceleration in double-digit  growth in compensation was recorded from 15.9% to 20.3%.

According to the Bureau, the number of vehicles with MTPL policies  for 2024 increased slightly - by only 1.1%, while a year ago the  growth was 10%. In quantitative terms, by 2025, there were 674,524  thousand vehicles with MTPL contracts in the country, but the number  of active contracts was 1.317 million (minus terminated ones - 1.194  million). The excess of contracts over the number of cars is  explained by the large number of quarterly (short-term) contracts. In  the total number of MTPL contracts, the share of E-policies increased  over the year from 25% to 31%, amounting to 413,033 thousand, with an  acceleration of annual growth from 17.8% to 22.2%.

At the end of 2024, the volume of insurance premiums collected under  current contracts exceeded 29.7 billion drams ($75 million), and the  volume of insurance indemnities reached 21.9 billion drams ($55.1  million). Moreover, the volume of indemnities paid in cases of  simplified registration of road accidents (Europrotocol) increased by  39.1% over the year (with an exit from last year's 4.9% decline) - to  2.7 billion drams ($6.7 million), and the average size of one payment  accelerated in annual growth from 8.4% to 19.1%, reaching 101,049  thousand drams ($255, against $210 a year ago). In terms of total  insurance compensation, the average size of one payment accelerated  in annual growth less noticeably - from 10.8% to 11.3%, amounting to  262,113 thousand drams ($661, compared to $582 a year ago).

According to the Bureau, the largest number of vehicles with an MTPL  policy are covered by LIGA Insurance Insurance Company - 138,347  thousand units, which also has the highest loss ratio for MTPL at  90%. A slightly smaller number of vehicles with an MTPL policy are  covered by Nairi Insurance and Sil Insurance - 132.8 thousand units  and 132.4 thousand units, respectively, for which the loss ratio for  MTPL is 73% and 83%. The largest volume of insurance premiums under  current MTPL contracts is also provided by Nairi Insurance and LIGA  Insurance - 6.7-6 billion drams (23-20% of the total volume), and  they are also leaders in the volume of compensation in this class -  4.8-5.8 billion drams (22-27% of the total volume). LIGA Insurance  and Nairi Insurance also have the highest payouts for simplified  accident registration (Europrotocol) - 28-21% of the total market  volume. Armenia Insurance is the leader in the number of E-policies -  135.8 thousand or 33% of the total number of such contracts on the  market. In terms of the total number of active contracts, the first  two positions are occupied by Nairi Insurance and Armenia Insurance -  267.6-266.1 thousand or 20.3-20.2% of the total number on the market.

Since April 2023, the transition to liberalization of OSAGO tariffs  has started in the Armenian insurance market and after a quarter, the  loss ratio for this class began to grow.

In Armenia, since the end of July 2023, there are already 7 insurance  companies operating, as EFES Insurance Company has returned to the  market, which is currently preparing to enter the compulsory motor  third party liability insurance (MTPL) segment. (The calculated  exchange rate of the dram against the US dollar as of 12/31/2024 was  396.56 drams/$1, against 404.79 drams/$1 as of 12/31/2023).