ArmInfo. The loss ratio for Compulsory Motor Third-Party Liability (CMTPL) insurance in the Armenian insurance market fell to 72.1% in the first half of 2026, down from 73.3% during the same period in 2025.
This decline in the H1 2026 loss ratio occurred alongside accelerated annual growth in active contracts (rising from 7.6% to 9.2%), insurance premiums (increasing from 16.8% to 19.1%), and a more pronounced surge in claims payouts (jumping from 6.1% to 18.3%). Notably, the downward trend in the loss ratio began in May of this year following four consecutive months of growth, whereas the indicator steadily declined throughout 2025 from 81.8% to 76.3%. These figures are supported by data from the Armenian Motor Insurers' Bureau.
According to industry experts, CMTPL premiums continue to rise despite the declining loss ratio, allowing insurance companies to offset inflationary risks driven by broader inflation and the rising cost of auto spare parts. Furthermore, a trend has emerged where insurers charge higher premiums even to lower-risk drivers to smooth out their overall loss statistics. Consequently, consumers particularly accident-free drivers are questioning the efficacy of the bonus-malus system, with many under the impression that the mechanism is either entirely ineffective or applied without its intended "bonus" incentives.
According to the Bureau, the number of vehicles with CMTPLI policies is growing moderately year-on- year by 6.7% (compared to 3.5% the year before). In quantitative terms, as of June 2026, there were 727,958 vehicles with compulsory motor third-party liability insurance (CMTPLI) policies in the country, with the number of active policies amounting to 722,318 (excluding terminated policies 660,914). The share of E-policies in the total number of CMTPLI policies increased year-on-year from 36% to 38%, reaching 270,401 by July of this year (growth slowed from 22.1% to 14.5%).
In the first half of 2026, the volume of insurance premiums collected under existing policies reached 19.1 billion drams ($51.9 million), while the volume of insurance claims exceeded 12.8 billion drams ($34.9 million). Moreover, the volume of compensation paid out under simplified accident reporting (Europrotocol) worsened year-on-year, reversing from 64.2% growth to a 2.1% decline, amounting to 1.8 billion drams ($4.9 million). The average payment size also worsened year-on-year, from 33.2% growth to a 9.5% decline, amounting to 111,164 thousand drams ($302, compared to $320 a year ago). Meanwhile, for total insurance compensation, the average payment size maintained growth, but with an annual growth rate slowing from 5.3% to 4.6%, amounting to 281,268 thousand drams ($765, compared to $700 a year ago).
According to the Bureau's data, REGO Insurance covers the largest number of CMTPL-insured vehicles, with 139,147 units (representing over 19% of the market share). Notably, this insurer's CMTPL loss ratio increased year-over-year from 68% to 74%. The highest CMTPL loss ratio was recorded by INGO at 79% (up from 72% a year ago), while the lowest was registered by Nairi Insurance at 60% (down from 63% a year ago).
Nairi Insurance and REGO Insurance generate the highest volume of premium written under active CMTPL contracts, exceeding AMD 3.6 billion and AMD 3.35 billion respectively (accounting for 19% and 18% of the total market volume). However, INGO and Nairi Insurance continue to lead in claims payouts within this class, with volumes of AMD 2.5 billion and AMD 2.2 billion respectively (representing 19% and 17% of the total market). INGO and LIGA Insurance stand out for having the highest payouts under simplified accident reporting (the "Europrotocol"), amounting to AMD 444.7 million and AMD 367.2 million respectively (representing 25% and 20% of the total market).
INGO also continues to record the leading number of e-policies at 95,796 (representing over 35% of all such contracts in the market), followed by LIGA Insurance in second place with 50,889 policies (19%), and Armenia Insurance in third place with 45,367 policies (17%). Conversely, Nairi Insurance maintains the lowest number of e-policies at 13,568 (accounting for just 5% of the total market share for e-policies).
In terms of the total number of active contracts, the top two positions are held by REGO Insurance and Nairi Insurance, with 157,065 and 130,358 active contracts respectively (representing 22% and 18% of the market total). However, it is worth noting that Nairi Insurance, despite leading in premium collection, also shows a high volume of terminated contracts totaling 11,038 (with AMD 159.4 million payable or already paid out). This is only slightly behind INGO, which recorded 12,951 terminated contracts (with AMD 170.9 million payable or already paid). The lowest number of terminated contracts was recorded by Armenia Insurance and LIGA Insurance, with 6,932 and 9,296 contracts respectively.
It should be noted that in April 2023, the Armenian insurance market began to liberalize MTPL tariffs, and within a quarter, the loss ratio for this class began to increase. This trend continued until 2025, at the beginning of which, in February, a significant increase in MTPL tariffs allowed insurance companies to significantly improve their efficiency, and the loss ratio began to decline. However, in 2026, specifically in February, the loss ratio resumed its upward trend, continuing until May, after which a decline was observed.
The Armenian Bureau of Motor Insurers, as part of amendments to the MTPL General Conditions, introduced increased insured amounts and maximum compensation limits effective April 1, 2026. In particular, the insured amounts and maximum compensation limits have been increased as follows: For property damage, the amount has been increased from the current 1.8 million drams to 2.5 million drams; For damage to health, the amount has been increased from the current 3.3 million drams to 3.5 million drams; At the same time, the insured amounts for the total amount of damage caused to all victims as a result of a single insured event have been proportionally increased and set at 25 million and 35 million drams, respectively.
Recall, there are seven insurance companies operating in Armenia, six of which are licensed to provide Compulsory Motor Third-Party Liability (CMTPL) insurance. (As of June 30, 2026, the calculated exchange rate of the Armenian Dram against the US Dollar stood at AMD 367.89/$1, compared to AMD 384.47/$1 as of June 30, 2025).
