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Cheerful Year Beginning

The LICs in terms of premiums continued to grow in January, 2020.
Cheerful Year Beginning

The aggregate gross premiums of LICs increased by 51.7% in January, 2020 reaching 18.2 billion tenge compared to the analogic index in 2019. The premium growth rates in the main segments of life insurance remain high. Annuity insurance and retirement annuities showed a dynamics of 55.5% and 67.3%, respectively. However, in terms of revenue, life insurance became a leader collecting 7.5 billion tenge of premiums (an increase of 46.6%, year-on-year). According to the results of January, 2020, life insurance occupies 41.4% in total premiums of LICs maintaining its position in relation to January, 2019, when its share was 42.8% in total premiums.

7 companies collected life insurance premiums in January, 2020. Halyk life has the maximum portfolio of life insurance premiums. It raised 3.4 billion tenge in January, 2020 showing an increase of 70.4% compared to January, 2019. The company occupies 44.9% of the life insurance segment. Nomad Life is in the second place as of January collecting 1.9 billion tenge of premiums, which is 22.9% more than in January, 2019, and has increased its market share in the segment to 25.1%. Thus, LIC European Insurance Company (EIC) went down to the third position, it attracted 1.8 billion tenge of premiums and showed an increase of 16.6%. As a result, the market share of EIC declined to 23.8%. The maximum dynamics of life insurance premiums (+528.9%) was obtained by LIC Freedom Finance Life. The company raised 98.2 million tenge in January occupying a 1.3% market share in the life insurance segment. All companies operating in the life insurance segment showed a positive result of revenue.

Annuity insurance, which is based on pension annuities, has increased by 55.5% collecting 5.3 billion tenge of premiums in January, 2020. The dynamics in pension annuities was 67.3%, and premiums reached 5 billion tenge in absolute terms.

Nomad Life retains the leading position in the annuity insurance segment, including the retirement annuity segment. According to the results of January, 2020, the company's annuity insurance fees amounted to 1.9 billion tenge (an increase of 260.6%), and retirement annuities – 1.8 billion tenge (an increase of 380.7%, year-on-year). LIC Nomad Life makes 36.7% of the market in the annuity insurance segment and 36.6% in the retirement annuity segment.

LIC Halyk life is in the second place in terms of premiums. The company attracted 1.4 billion tenge for annuity insurance, including 1.3 billion tenge – for retirement annuity premiums. The annual premium growth was 159.6% and 289.2%, respectively. The market share of Halyk life in the annuity insurance segment and in the retirement annuity segment increased to 26.6% and to 25.2%, respectively (year-on-year). LIC Standard Life is in third place. The company collected 1.2 billion tenge on annuity insurance premiums and 1.19 billion tenge on retirement annuities in January. However, the dynamics of premiums at LIC Standard Life turned out to be negative (-42.3% and -42.9%, respectively, year-on-year). LIC Freedom Finance Life showed the maximum increase in premiums (12,999.9%) in the annuity insurance segment in January, 2020. The fees amounted to 647.4 million tenge in absolute terms. This allowed the company to obtain a market share of 12.1% for annuity insurance and 12.8% for retirement annuities. Three of five LICs collecting premiums in the annuity and life insurance segments showed positive results and two – negative.

Premiums in the “Employer Liability Annuity” (ELI) class in January, 2020 decreased by 49.7% compared to January, 2019 with the growth of 5.2%.The premiums amounted to 161.7 million tenge in monetary terms. The share of ELI premiums in total LIC premiums has decreased from 2.7% to 0.09% (January to January). Four of five LICs working in this segment showed a decline in premiums.

The maximum result was obtained by LIC Nomad Life; it collected 69.8 million tenge and made 43.2% of the ELI market. Halyk life showed the second result attracting 60.5 million tenge of premiums and occupying 37.4% of the ELI segment. The third place belongs to LIC Standard Life; it has collected 24.5 million tenge of premiums and occupies 15.1% of the ELI market.

The “Other annuity insurance types” segment in January, 2020 changed the trend by showing positive growth. LICs raised 131.5 million tenge against 96.4 million tenge in January, 2019 increasing fees by 36.4%. The segment premiums are collected by two companies. LIC Halyk life has raised 87.9 million tenge increasing fees by 60.6%. LIC Nomad Life attracted 43.5 million tenge increasing premiums by 4.5%. According to the results of January, LIC Halyk life occupies 66.9% and LIC Nomad Life - 33.1% of the “Other types of annuity insurance” segment.

According to the results of January, 2020, accident insurance premiums (AI) collected by LICs increased the dynamics to 50.4%, the premiums as of January, 2019 grew by 40.4% (year-on-year). LICs raised 874.8 million tenge, premiums made 4.8% in the overall LIC portfolio. Four LICs showed a positive trend in premiums, one - negative. LIC Halyk life has the maximum portfolio in accident insurance among LICs premiums of 307.9 million tenge (an increase of 2.2% compared to January, 2019). The second segment player European Insurance Company (EIC) grew in premiums by 25.8% collecting 312.5 million tenge.

However, the market share of Halyk life (35.2%) and EIC (35.7%) in January, 2020 decreased significantly compared to January, 2019, when the share of Halyk life was 51.8% and EIC - 42.7%. The reason is the distribution of premiums in favor of other companies. LICs Nomad Life, Freedom Finance Life, and Eurasia demonstrated the high dynamics of premiums. Two leading LICs formed 94.5% of premiums in January, 2019; the share of leaders fell to 70.9% in January, 2020.

The health insurance portfolio (VHI) among LICs in January, 2020 showed a positive trend of 108,765.3% against a fall of 49.8% in January, 2019. Four life insurance companies have VHI portfolios. Due to the new player entering the market the segment leader has changed.

The premiums in the “Employee Health Insurance while Performing Labor Duties” (CAI) segment in January, 2020 showed an increase of 36.1% (reaching 3.8 billion tenge) against a decline of 10.1% in January, 2019. Premiums make 21.2% of total LIC premiums. Nomad Life is a leader in terms of premiums. The company collected 1.33 billion tenge of premiums showing growth of 16.1% and made 34.6% of the CAI market. LIC Halyk life is in the second position, its CAI portfolio is 1.31 billion tenge, the premiums have increased by 26.7%, and the market share is 34%. LIC Standard Life remains the third largest insurer in the CAI segment. The company collected 354.8 million tenge of premiums showing a decrease of 30.5% (year-on-year) and retaining 9.2% of the CAI segment.

The high dynamics of premiums demonstrated by the rest of LICs reduces the CAI segment concentration. Three leaders collected 95.2% of the premiums in January, 2019, and only 77.9% - in January, 2020. LIC Freedom Finance Life accumulates 284.5 million tenge of premiums, LIC Eurasia - 251.6 million tenge, LIC State Annuity Company (SAC) - 164.1 million tenge, LIC KM Life – 152.7 million tenge.

Changes have also occurred in the VHI insurance segment among LICs. 95.8% of VHI premiums among LICs belonged to LIC Standard Life in January, 2019. The share of LIC Standard Life amounted to 0.1%; the company attracted 300 million tenge of premiums falling by 40.6% in dynamics in January, 2020. LIC Freedom Finance Life has attracted 294 million tenge of premiums increasing fees by 2,572.7% and occupies 0.05% of the VHI market among LICs (a year ago, the market share in the segment was 2.09%). The leader of the segment was LIC KM Life. The company has collected 573 million tenge of premiums and occupies 99.9% of the VHI insurance market among LICs.

As of January, 2020 the total assets of LICs amounted to 253.8 billion tenge showing an increase of 37.7%. Halyk life and Nomad Life remain the largest LICs; they form 71.2% of all LIC assets. Insurance reserves increased by 30.1%, to 344.3 billion tenge. The equity of LICs increased by 59.1% (year-on-year) up to 78.9 billion tenge.

Photos are from open sources.

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