19
CEE, CIS and SEE insurance markets in 2011
CEE, CIS and SEE
insurance markets
in 2011
XPRIMM Insurance Report FY2011
• 32 countries: CEE, SEE, CIS• Full length statistics in EUR and national currency
on www.xprimm.com
Macroeconomic view
• CEE - 5.3% GDP growth in 2011 according IMF• Diverging results across the region:
• Turkey and Baltics : >5% - 7%• Bulgaria, Hungary, Czech Rep. : 1.5 – 2%• Croatia – flat
• Common characteristics in most countries:• Economic slowdown in Q4• Reasonable inflation rates• Rather high unemployment rates• Weak purchasing power of the population• Low crediting activity
Macroeconomic view
• CIS - 4.5% GDP growth in 2011 according Eurasian Development Bank (except Georgia).
• Diverging results across the region:• Turkmenistan : 9.3%• Russia, Ukraine, Moldova and Azerbaijan : 4 – 4.5%
• Common characteristics in most countries:• Raising inflation rates• High unemployment rates• Weak purchasing power of the population
• Turkey - 7.6% GDP growth in 2011• Greece - 4.5% GDP fall in 2011
CEE insurance market
Romania
Estonia
Hungary
Croatia
Bulgaria
Czech Republic
Slove
niaSe
rbia
Albania
Bosnia & Herze
govin
a
Slovak
ia
Macedonia (
FYROM)
MontenegroPolan
d
Lithuan
iaLat
via
-10.00
-5.00
-
5.00
10.00
15.00
20.00
GWP and GDP y-o-y growth rates in 2011, %
GWP growth rate GDP growth rate
HU 12% HUF
-13.3% GWP nominal change in EUR
PL12% PLN -5.4% GWP
nominal change in EUR
GWP evolution depends on the GDP growth model
CEE Consolidated indicators
• GWP: EUR 31.97 billion <-> -4% nominal change• Weighted growth rate (local currencies): +2.11%
• Paid claims: EUR 18.6 billion (Slovakia excepted)• Insurance density: EUR 253/capita (~4% down)
Slove
nia
Czech Republic
Slovak
ia
Poland
Estonia
Croatia
Hungary
Latvia
Lithuan
ia
Bulgaria
Montenegro
Romania
Serbia
Bosnia & Herze
govin
a
Macedonia (
FYROM)
Kosovo Te
rritory
Albania
0.00
200.00
400.00
600.00
800.00
1000.00
1200.00 Insurance density 2011 (EUR/capita)
CEE AVERAGEEUR 253/capita
CEE Market shares
• Almost unchanged market shares
Romania6%
Croatia4%
Bulgaria3%
Serbia2%
Lithuania2%
Estonia1%
Latvia, Bosnia and
Herzegovina, Macedonia (FY-ROM), Kosovo,
Montenegro and Albania
3%Poland
40%
Czech Republic19%
Hungary8%
Slovakia7%
Slovenia7%
1. Poland 41.06 40.472. Czech Rep. 3. Hungary 9.08 8.204. Slovakia 6.056.605. Slovenia 6.29 6.546. Romania 5.92 5.74
CEE Market portfolio
• Life insurance: 45.6%• Non-life insurance : 54.5%
Unit-linked; 18.4%
Other life ins.; 27.2%
Motor hull; 11.9%
MTPL; 16.9%
Property; 12.0%
GTPL; 3.6%
Other non-life ins.; 10.0%
Macedonia (FYROM)
Latvia
Albania
Montenegro
Bulgaria
Bosnia and Herzegovina
Serbia
Romania
Croatia
Slovenia
Lithuania
Estonia
Czech Republic
Slovakia
Hungary
0% 20% 40% 60% 80% 100%
Life insurance Non-life insurance
CEE Life insurance• 45.6% of CEE portfolio (-1pp y-o-y)• GWP: EUR 14.58 billion -> 6% y-o-y decrease
• Best dynamic: Albania (25%), Macedonia (40%)• Worst dynamic: Latvia (-24%), Estonia (-13.8%) and Hungary
(-11%)• Insurance lines:
• Traditional life insurance – negative trend• Unit-Linked – positive evolution in most countries (+1.6pp
weight in CEE portfolio; +4.3pp weight in life insurance GWP)• Perspectives: almost no chances for reinstating or
adopting fiscal incentives
CEE Life insurance
Poland
Czech Rep
ublic
Hungary
Slova
kia
Slove
nia
Romania
Croati
a
Lithuan
ia
Estonia
Bulgaria
Serbia
Bosnia an
d Herzeg
ovina
Latvia
Montenegr
o
Macedonia (
FYROM)
Albania
-30.00
-20.00
-10.00
-
10.00
20.00
30.00
40.00
50.00
PL CZ HU SK SL RO HR LT EE BG LV
-40.00
-20.00
0.00
20.00
40.00
60.00
80.00
UL weight in life insurance UL change
+73%
Life insurance dynamic 2011
UL insurance weight in life segment and dynamic 2011
+102%+92%
+56%
+2%Paid claims growth rate
CEE Property insurance
• 12% of CEE portfolio (< +1pp y-o-y)• GWP: EUR 3.83 billion -> 2.6% y-o-y increase• Paid claims: EUR 1.6 billion -> -28% y-o-y decrease
• Latvia and Lithuania - the only CEE countries recording much higher property claims than in 2010
Albania
Bosnia & Herze
govin
a
Bulgaria
Croatia
Czech Republic
Estonia
Hungary
Latvia
Macedonia (
FYROM)
Montenegro
Poland
Romania
Serbia
Slove
nia0%
10%20%30%40%50%60%70%80%90%
100%
Damages to property Fire and allied perils
Weight of “fire and allied perils in line” in property segment
CEE Motor insurance
• 29% of CEE portfolio (< -1pp y-o-y)• GWP: EUR 9.2 billion -> 5.77% y-o-y decrease• Paid claims: EUR 5.5 billion -> ~8% y-o-y decrease• Trends:
• Price war – “to the limit of economic acceptability”• Increasing bodily claims• Insurance fraud • high acquisitions costs
CEE Motor insurance
Poland
Czech Rep
ublic
Romania
Slova
kia
Slove
nia
Hungary
Croati
a
Bulgaria
Serbia
Lithuan
ia
Bosnia a
nd Herzeg
ovina
Estonia
Latvia
Macedonia (
FYROM)
Montenegr
o
Albania
-
500.00
1,000.00
1,500.00
2,000.00
2,500.00
3,000.00
3,500.00
MTPL
Motor Hull
Motor Hull: Lithuania , Latvia, Albania and Bosnia – positive dynamicMTPL: 10 out of 17 countries, positive dynamic; Hungary, Romania, Albania and Czech Rep. – double digit negative dynamic
CIS Consolidated indicators
• GWP: EUR 33.67 billion -> 17.5% nominal change• Paid claims: ~EUR 22.5 billion -> 11.8% increase• Insurance density: EUR 122/capita (~17% up)
CIS AVERAGEEUR 122/capita
Armenia
Azerbaijan
Belarus
Georgia
Kazakh
stan
Kyrgyzs
tan
MoldovaRussi
a
Tajikis
tan (e
)
Turkm
enistan
Ukraine
Uzbekistan
0.00
50.00
100.00
150.00
200.00
250.00
CIS Market shares
• Russia: > 90% share; EUR 30.4 billion GWP• Ukraine: 4.03% share; EUR 1.4 billion GWP• Kazakhstan: 3.07% share; EUR 1.03 billion GWP
0.65 3.07
4.13
90.34Kyrgyzstan Tajikistan Armenia Turkmenistan Moldova Uzbekistan Georgia AzerbaijanBelarus Kazakhstan Ukraine Russia
CIS Specificities
• Extreme diversity hardly comparable markets• Complexity• Portfolio• Legislation• Ease of access for foreign undertakers• Affordability• Etc.
SEE: Turkey, Greece, Cyprus• Different development stages of the insurance market• Very different dimensions• Currently, very different economic trends• Turkey:
• GWP: EUR 6.9 billion – 1.9% y-o-y increase• Life insurance – cvasi underdeveloped (15.6% weight in portfolio)• Motor insurance – almost 40% weight in portfolio• Property insurance – 22% weight in portfolio
» 3.72 million mandatory policies sold by TCIP in 2011» Less than 23% coverage of 16 million housing units
• a hot spot on the acquisitions map
A changing landscape• PZU - preparing geographical expansion – first step, the Baltics• TRIGLAV and SAVA Re - interested to enter new markets or
strengthen their presence in the current ones• Vienna Insurance Group - new acquisitions in Poland and
Bosnia & Herzegovina and also intends further acquisitions in Hungary and Moldova,
• different insurers and banks are targeting the Russian market• big Russian players (ROSGOSSTRAKH) - expanding in the
neighboring countries• important legislative adjustments in the young markets• Solvency II regime – important challenge for the EU members
