Russian experts associate such opposing predictions, both of drop and growth, with extremely high uncertainty in the life insurance market of the Russian Federation.
The uncertainty is associated with the planned introduction of life insurance sales standards through banks in Russia. A rapid growth of this market (+40.7% up to 324.9 billion rubles for the first nine months of 2018, according to the Central Bank of the Russian Federation) is due to sales of investment life insurance products through the banks, offered to customers as a potentially more profitable alternative to deposits. The Bank of Russia has previously published a draft directive that plans to oblige insurers and their agents to sell ILI products (personal life insurance) with a reminder listing the risks of this product: lack of income security, lack of guarantees of the Deposit Insurance Agency, and inability to withdraw the invested funds without loss. As of May 2019, the All-Russian Union of Insurers is introducing similar standards at the insurance market level.
If standardization of information does not scare away citizens of the Russian Federation, the rates on deposits will be relatively low and banks will continue to intensively sell investment life insurance, the insurance premiums will increase by about 28% to 575 billion rubles, Expert RA notes. If, as a result of introduction of standards, customers in Russia massively refuse to buy ILI in favor of other financial instruments, the volume of life insurance premiums in 2019 will drop to the level of 2017, about 350 billion rubles, which will mean a drop in the market by 20-25%.
Photos: aravot-ru.am, banki.ru