country profile | Russia Strong growth Insurance market Figures presented by the supervisory au- The most important change in insurance portfolio thority of the insurance market in Moscow law is the requirement regarding the in- 1H 2011 indicate for the first half of the current crease of the underwritten share capital. year an increasing evolution of the profile In the first half of the year, some insurers industry of over 13% in EUR, the market - medium and small - have taken steps to reaching more than EUR15.4bn. eliminate or postpone the deadline of this For the development of the market, the gre- law. However, it seems that, starting next atest influences were the significant increase Life insurance (V) 2.36% year, the insurance companies that do not in car sales, the revival of the construction meet minimum capitalization require- Personal insurance (V) 13.82% market, increasing trade and goods trans- ment will face the withdrawal of license Property insurance (V) 26.50% portation. As a result, the market grew, and and termination of activity, said Andrey Liabilities (V) 2.14% grew significantly in almost all segments, VESELKOV. Mandatory health ins. 46.82% explained the market evolution Andrey Other important changes carried out in MTPL 7.20% VESELKOV, General Manager, Media-Infor- 2011 were due to the increased MTPL tar- mation Group, "Insurance Today ". Other mandatory ins. 1.15% rifs, as well as due to the launching of the Analyzing each market segment separate- draft law regarding mandatory insurance ly, traditionally, travel insurance, followed by liability insurance were the most profi- of highly dangerous objects. Sources: table for insurers. Despite this reality, the Speaking about the near future of the Central Bank of the Russian Federation highest growth rates were for life insurance, insurance market, Andrey VESELKOV Federal Insurance Supervision Service agricultural insurance respectively, added considers that the market will continue its Media Information Group VESELKOV. growth. In this industry, as in all the Russian REMARK According to Andrey VESELKOV, in full glo- economy, everything depends on oil prices Russian currency exchange rate for bal crisis, many insurance companies have and therefore on the welfare of the world calculations: revised their strategy at regional level, eli- economy. If by the end of this year there isn’t 1 EUR = 40.3870 Ruble - RUB minating the unprofitable branches.Almost a new wave of crisis, then I am convinced th (June 30 2011) all large companies have revised their pricing that the insurance market in our country 1 EUR = 38.1863 Ruble - RUB policies, with the main benefit of reducing the will continue to grow, at least until the end th (June 30 2010) phenomenon of dumping prices. of 2011. Market porfolio as of June 30th, 2011 v - voluntary 1H/2011 1H/2010 NOMINAL % in all GWP Business line GWP CLAIMS GWP CLAIMS EVOLUTION (%) EUR m. EUR m. EUR m. EUR m. EUR % TOTAL MARKET 15,443.80 10,493.09 13,645.01 9,616.95 13.18 100.00 LIFE INSURANCE (V) 364.24 89.46 234.30 71.75 55.46 2.36 NON-LIFE INSURANCE 15,079.55 10,403.63 13,410.71 9,545.20 12.44 97.64 Personal insurance (V) 2,134.98 955.50 1,925.96 851.33 10.85 13.82 Accidents (V) 545.92 94.21 439.07 67.72 24.33 3.53 Health (V) 1,589.05 861.29 1,486.88 783.62 6.87 10.29 Property insurance (V) 4,093.17 1,714.06 3,639.84 1,820.78 12.45 26.50 MOTOR HULL (V) 1,892.53 1,256.00 1,657.17 1,360.03 14.20 12.25 Properties insurance (V) 1,475.67 301.89 1,380.14 316.49 6.92 9.56 Other goods (V) 246.46 28.64 219.69 20.13 12.19 1.60 Agricultural ins. (V) 223.51 87.05 150.93 50.56 48.09 1.45 Railway, aircraft and ships (V) 130.65 30.36 143.70 42.66 -9.08 0.85 Financial risks (V) 124.35 10.12 88.21 30.91 40.97 0.81 Liabilities (V) 330.86 37.58 369.39 33.83 -10.43 2.14 Mandatory health ins. 7,230.84 6,909.08 6,168.67 6,084.14 17.22 46.82 MTPL 1,111.65 703.91 1,138.03 683.45 -2.32 7.20 Other mandatory ins. 178.06 83.50 168.83 71.66 5.46 1.15 TOTAL VOLUNTARY INSURANCE 6,923.25 2,796.60 6,169.49 2,777.70 12.22 44.83 TOTAL MANDATORY INSURANCE 8,520.54 7,696.49 7,475.52 6,839.25 13.98 55.17 | country profile TOP 25 - Life insurance TOP 25 - Mandatory health insurance GWP MARKET GWP MARKET Company Region 1H/2011 SHARE Company Region 1H/2011 SHARE EUR m. % EUR m. % ROSGOSSTRAKH Life Moscow 48.53 13.32 MAKS - M Moscow 987.45 13.66 Andrey VESELKOV, ALICO Moscow 44.12 12.11 ROSNO - MS Moscow 870.99 12.05 General Director, ALFASTRAKHOVANIE Moscow 37.28 10.23 SOGAZ MED Moscow 687.03 9.50 Media–Information SOGAZ Life Moscow 35.04 9.62 ROSGOSSTRAKH MED S. Petersburg 383.42 5.30 Group, “Insurance RUSSIAN Standard Ins. Moscow 30.43 8.36 KAPITAL MED Insurace Kogalym 376.28 5.20 Today” SOGEKAP Life Ins. Moscow 23.31 6.40 SIBIRI Kemerovo 338.79 4.69 Read the full interview on ALLIANZ Rosno Life Moscow 21.77 5.98 SOVITA Moscow 294.08 4.07 www.xprimm.com CIV Life Moscow 18.68 5.13 RESO-MED P. Pasad 243.89 3.37 GENERALI PPF Life Moscow 15.02 4.12 SPASSKIE VOROTA - M Moscow 231.12 3.20 RAIFFEISEN Life Moscow 12.86 3.53 YUGORIA - MED Surgut 214.22 2.96 “Troop movements” in the CHULPAN Life Almetyevsk 10.02 2.75 INGOSSTRAKH-M Moscow 185.19 2.56 RENAISSANS Life Moscow 8.66 2.38 AK BARS-MED Kazan 154.95 2.14 reinsurance market DISKONT Saratov 7.08 1.94 URALSIB Klimovsk 143.08 1.98 ROSSIA Moscow 6.61 1.82 ALFASTRAKHOVANIE Moscow 111.35 1.54 According to the Specialy Magazine RE- AVIVA Moscow 5.51 1.51 ASTRAMED-МС Yekaterinburg 100.07 1.38 MARK and the Federal Service of Insurance Supervision, since the beginning of 2011, ZHASO Life Moscow 5.18 1.42 NADEJDA Krasnoyarsk 96.35 1.33 the reinsurance market in Russia has INGOSSTRAKH Life Moscow 4.65 1.28 DALI-ROSMED Khabarovsk 93.84 1.30 decreased by about 20 companies. Also, KOLYMSKAYA Khabarovsk 3.86 1.06 ASK-MED S.Petersburg 88.06 1.22 104 companies do not meet the minimum ERGO Life Moscow 3.02 0.83 MEDSTRAKH Moscow 85.86 1.19 requirement regarding the share capital ac- URALSIB Life Moscow 2.73 0.75 SAHAMEDSTRAKH Yakutsk 83.86 1.16 cording to the law that will entry into force ASKO Life N. Chelny 2.69 0.74 EMESK Stavropol 70.25 0.97 at the beginning of 2012. According to this, MSK Life Moscow 2.30 0.63 RUSSKIY MIR S. Petersburg 61.26 0.85 starting January first 2012, only companies SURGUTNEFTEGAZ Life Moscow 2.21 0.61 GSMK S. Petersburg 56.78 0.79 with a share capital of at least RUB480m will SOYUZ Life R. -on-Don 2.20 0.60 MEDINKOM Yekaterinburg 56.49 0.78 be able to carry on the insurance activity. VSK - LIFE LINE Moscow 1.27 0.35 MEDICA-VOSTOK Krasnoyarsk 53.51 0.74 Thus, at the beginning of the current year, FIRST 10 COMPANIES 287.03 78.80 FIRST 10 COMPANIES 4,627.28 63.99 131 companies operate on the reinsuran- FIRST 25 COMPANIES 355.03 97.47 FIRST 25 COMPANIES 6,068.18 83.92 ce segment, of which 18 are specialized TOTAL MARKET 364.24 100.00 TOTAL MARKET 7,230.84 100.00 companies. A year before, on the reinsu- TOP 25 - Personal insurance TOP 25 - Property insurance rance market in Russia, 23 specialized rein- surance companies and 150 composite GWP MARKET GWP MARKET companies (re/insurance) were activating. Company Region 1H/2011 SHARE Company Region 1H/2011 SHARE EUR m. % EUR m. % According to REMARK Magazine, in the first quarter of 2011, two large reinsuran- SOGAZ Moscow 377.70 17.69 ROSGOSSTRAKH* Lyubertsy 483.03 11.80 ce companies switched from companies ROSNO Moscow 139.32 6.53 INGOSSTRAKH Moscow 411.85 10.06 specialized strictly on reinsurance to ALFASTRAKHOVANIE Moscow 120.12 5.63 SOGAZ Moscow 394.50 9.64 composite companies, through merger. ROSGOSSTRAKH* Lyubertsy 109.69 5.14 RESO-Garantia Moscow 313.68 7.66 Therefore, in February, the company ME- RESO-Garantia Moscow 99.46 4.66 ALFASTRAKHOVANIE Moscow 215.37 5.26 GARUSS RE merged with MEGARUSS – D, ZHASO Moscow 91.57 4.29 VSK Moscow 195.68 4.78 and in March, EASTERN Re merged with INGOSSTRAKH Moscow 89.45 4.19 SOGLASIE Moscow 191.35 4.67 insurance company MEGAPOLIS, being TRANSNEFT Moscow 72.12 3.38 MSK Ins. Company Kazan 117.82 2.88 then renamed EASTERN Insurance and GENERALI PPF Life Moscow 69.06 3.23 RENAISSANS Ins. Moscow 109.46 2.67 Reinsurance Company. VSK Moscow 54.25 2.54 ROSNO Moscow 94.60 2.31 SOGLASIE Moscow 52.31 2.45 KAPITAL Insurance Kogalym 83.25 2.03 ALLIANZ Russia S&P's rating revised to VBT Insurance Moscow 47.17 2.21 URALSIB Moscow 67.03 1.64 STABLE outlook MAKS Moscow 46.33 2.17 YUGORIA K.Mansiysk 65.07 1.59 STANDARD & POOR's Ratings Services said on RENAISSANS Ins.