Czech insurance market down 0.3 pct in 2011 after yrs of growth

The Czech insurance market grew by 8 percent in 2010. CAP groups together insurers with a 98 percent share in the domestic market.

Life insurance in 2011 rose by 1.9 percent and non-life insurance decreased by 1.6 percent.

The life-insurance market keeps growing. Interest in products with one-time payment was in particular by current deals whose volume rose by a fifth. Overall, life-insurance with one-time payment registered a Kc700m decrease.

A growth in insurance with regular payment of premiums is encouraging, said CAP executive director Tomas Sikora.

However, the total number of life-insurance policies sank by over 100,000, he added.

The unfavourable development in non-life insurance was not reversed by the positive trend in business insurance where billed premiums grew by 2.1 percent.

The total decrease in the non-life insurance market by Kc1.2bn against 2010 was caused mainly by a significant fall by insurance of motor vehicles, namely third-party mandatory insurance, by over 8 percent.

"I believe that last year was the last period when prices of motor vehicle insurance were decreasing. There is no space left for further price cuts and insurance companies will have to change their strategy for fighting for clients in the future," Sikora added.

CAP has changed the method for its statistics.

"To provide a more realistic picture of the development on the insurance market, we newly include in life insurance only 10 percent of the total value of billed premiums with one-time payment. The one tenth as a basis has been picked with respect to the average length of a contract with one-time payment which makes ten years," Sikora explained.

The strongest players on the Czech insurance markets, like before, are financial groups Generali PPF Holding (Ceska pojistovna, Generali, Ceska pojistovna Zdravi) and the VIG group (Kooperativa, Ceska podnikatelska pojistovna, Pojistovna Ceske sporitelny).

Pojistovna CS registered the highest year-on-year growth in billed premiums (by over Kc800m). CSOB Pojistovna and Allianz pojistovna reached growths of nearly Kc400m.

Largest insurers on the market:

Source: CAP

Author: ČTK
www.ctk.cz