Insurance Market Growth in 2014 Will Slow Down
The total volume of fees on the Russian insurance market will not exceed 7%, this being the maximum figure, according to Intesco Research Group analysts.
At that, a more realistic level is 5%. It is more than half the rate of the previous year: according to the Bank of Russia, during 2013 insurance companies were able to increase the volume of insurance fees up to 11.1%.
The situation change is explained by analysts, first of all, by low rates of economic growth of RF. Other reasons are inflation and the volume of expenditure on sales of insurance policies. The market is also affected by legal practices, especially as regards comprehensive cover and compulsory motor insurance.
Some large players set a growth bar even lower for themselves. For example, in February the Chairman of the Board of one of the largest insurance companies – SOGAZ – Sergey Ivanov stated in one of interviews for journalists that the company had a rather reserved attitude towards the plan for 2014 and set the bar of 3-4% (according to premium growth), as there are simply no drivers of growth. In 2013 SOGAZ’s fees amounted to 87.6 billion rubles, the growth in relation to the previous year being 12%.
The main market segments, where a slowdown is to be expected, will be corporate insurance, car insurance (including comprehensive cover and compulsory motor insurance), as well as the segment of compulsory liability insurance of the owner of a hazardous facility. The latter can decrease mostly due to requalification and consolidation of objects. The sector of compulsory civil liability insurance of the carrier will probably remain where it is now.
The segment of life insurance market stays apart. In 2013 it increased, in Russia on the whole, according to various estimates, by 58-62% and in monetary terms amounted to 85-87 billion rubles. The association of life insurance companies expects the growth of the segment to be on the level of 33.5%. The “Renaissance Life” company, the leader on the life insurance market by the volume of premium collected in 2013, had the growth of 147%.
The main driver of the insurance market growth in Russia is the bank sales channel. However, in 2014 credit insurance, according to analysts, will no longer develop with the previous rates, due to which forecasts for the insurance market are not so promising.
For more information, please, see “Moscow Market of Medical Services: Comprehensive Analysis and Forecast till 2016” by Intesco Research Group.
The given figures were calculated by analysts of Intesco Research Group based on the official statistics.