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Premium dynamics are improving

LIC premiums reduced the rate of decline by 3 times in August
Premium dynamics are improving

At the end of August 2022, the total gross premiums of LICs sank by 2.3% against a decrease of 7.8% in July (all year-on-year). LICs collected 239.9 billion tenge in monetary terms and with the accumulative part of insurance premium on the Unit-linked product - 243.9 billion tenge. LIC Nomad Life remains the only life insurance company offering a Unit-linked investment life insurance product. The cumulative part of insurance premium on this product amounted to 4 billion tenge in August. As of early September, 2022, the market share of LIC Nomad Life in the life insurance industry is 24% including Unit-linked sales, which is equivalent to 58.4 billion tenge.

The dynamics of premiums in the Life Insurance class remained in the positive zone in August in annual terms showing growth of 7.7% (7.9% increase in July and 6.9% decrease in June). LICs collected 119.4 billion tenge in total. Life insurance premiums made 48.9% (by the end of July - 50.9%) in the total LIC portfolio (including the accumulative part of insurance premium on the Unit-linked product). Of the nine LICs collecting premiums in this segment, two LICs showed a negative annual increase in premiums, while there were two such LICs in July.

LIC Halyk life is still a leader of the "Life insurance" class. The company's portfolio in this segment increased to 50.1 billion tenge in August, and the market share grew to 42% (in July - 41.2%). LIC Nomad Life takes the second place, its portfolio in this insurance segment has reached 28.3 billion tenge, and the market share is 23.78%. LIC European Insurance Company (EIC) remains the third largest life insurer. As a result of August, the LIC’s premiums increased to 27.2 billion tenge, and market share in the segment formed 22.8%.

The premiums in the Annuity Insurance class cannot show positive growth, however, the negative dynamics is gradually decreasing. At the end of August 2022, the drop was 38.3% compared to the same period last year, while in July, the premiums fell by 42.9% in annual terms.

LICs totally collected 57.3 billion tenge on annuity insurance, however, the share of such premiums in the total portfolio of LICs continues to decline. According to the results of August, the share dropped to 23.5%, while in July it was 24.1%. Of the eight LICs collecting premiums on the Annuity Insurance class, only three showed a positive increase in premiums in annual terms. LICs showed positive dynamics of premiums of 16.5% in relation to July.

Year-on-year premiums in the “Retirement annuities” class also reduced the decline dynamics. In August, LICs collected 42.3% less premiums than a year earlier, against an annual decline in premiums by 46.6% in July. LICs collected 50.9 billion tenge in monetary terms. Leadership in the segments of annuity insurance and retirement annuities still remains with LIC Nomad Life. At the end of August 2022, the company's portfolio on annuity insurance premiums grew to 18.2 billion tenge, including 17.3 billion tenge in the retirement annuity segment. The market share of LIC Nomad Life in the annuity insurance segment is 31.8%, including 34.1% in the retirement annuities segment.

LIC Halyk life is the second in annuity insurance with a portfolio of 16.7 billion tenge, including a 14.6 billion tenge portfolio in retirement annuities. The company’s share in total premiums on annuity insurance, including retirement annuities, is 29.2% and 28.7%, respectively. LIC Freedom Life remains the third in the segment. The company’s premium portfolio on annuity insurance increased to 11.4 billion tenge in August, including 10.7 billion tenge on retirement annuities. The market share of LIC Freedom Life in the annuity segment grew to 20%, and in retirement annuities - up to 21.1%. Of the eight LICs collecting premiums in the annuity insurance segment, five showed a decrease in fees in annual terms. In relation to July, LICs showed a positive dynamics of premiums of 18.1%.

The collection of premiums in the Employer Liability Annuity (ELA) class strengthened year-on-year in August 2022, the dynamics increased to 17.4% against an annual growth of 0.7% in July. LICs collected 3.7 billion tenge in total. LIC Halyk life remains the leader of the ELA segment, the company’s portfolio is 1.3 billion tenge. The LIC was able to increase the segment share to 36.1% in August, against 35.7% in July.

Based on the results of August, LIC KM Life is in the second place in the ELA segment with a 732.5 million tenge portfolio and forms 19.5% of the ELA segment. LIC Nomad Life has the third largest portfolio in the amount of 731.49 million tenge, which is 19.4% of total premiums of the ELA segment.

The segment "Other types of annuity insurance" grew by 83.3% in August 2022 against an increase of 94.5% in July (all year on year). The total premiums of LICs amounted to 2.6 billion tenge in monetary terms. LIC KM Life remains the segment leader. The company's portfolio reached 1.1 billion tenge, and the market share in the segment increased to 44.6% against 42.6% in July. LIC Halyk life is the second with a portfolio of 764 million tenge and market share of 29.2%. The third place is occupied by LIC Freedom Life, which has collected 505.7 million tenge of premiums and forms 19.3% of the segment (according to the results of July - 20.8% of the segment).

Accident insurance premiums collected among LICs in August 2022, entered the positive zone showing an increase of 8.6% against a fall of 1% in July (all year-on-year). The total LIC premiums exceeded 13 billion tenge in monetary terms. The segment leader LIC Freedom Life collected premiums in the amount of 4.9 billion tenge increasing its share in the segment to 37.8% against 33.6% in July. The second position is occupied by LIC EIC with 3.4 billion tenge of premiums, making 26.7% of the segment (in July - 26.8 segments). LIC Halyk life remains the third largest insurer in the segment with a portfolio of 2.5 billion tenge and market share of 19.8% (21.9% in July).

The premiums in the "Insurance of an employee against accidents in the performance of their labor duties" (CAI) sector increased the collection dynamics to 67.6% in annual terms at the end of August 2022 against an annual increase of 49.9% in July. LICs collected 47.2 billion tenge in monetary terms. There were changes in the composition of the largest segment insurers in August. LIC Halyk life moved up from the third to the first place doubling its portfolio of premiums to 13.1 billion tenge, which allowed it to make 27.9% of the segment against 18.8% in July. LIC Eurasia is in the second place with a portfolio of 11.1 billion tenge. The company’s share in the segment increased to 23.5% against 20.6% in July. The third place with a market share of 16.3% is occupied by LIC Nomad Life, it has collected 7.6 billion tenge of premiums. LIC KM Life, the segment leader as of July-August, left the top three largest insurers in CAI.

Health insurance premiums (VHI) among LICs showed the highest growth among segments of the Life Insurance industry in annual terms in August 2022. Aggregate fees increased by 89.3% (yoy), although they were lower than the results of July, when premiums rose by 142.9% compared to the same period last year.

The total portfolio of VHI premiums among LICs gained 2.8 billion tenge. LIC KM Life remains the segment leader with a portfolio of 1.9 billion tenge. The company's premiums grew by 42.4% in annual terms against an annual increase of 89% in July. The monthly growth in premiums was 39.6% against an increase of 1.5% in July. The high monthly dynamics of fees built up the market share of LIC KM Life in the segment, it rose to 66.6% in August against 64.6% in July. LIC EIC is in the second place having increased its premium portfolio to 913.8 million tenge but reduced its market share in the segment to 31.9% against 33.9% in July. LIC Freedom Life takes the third place in the segment among LICs. The company raised its portfolio of premiums in the segment to 25.7 million tenge in August but reduced its market share to 0.9% against 1% in July.

In August 2022, the total assets of LICs grew by 24.6% against an annual increase of 26.1% in annual terms in July and amounted to 871.5 billion tenge. Insurance reserves increased by 27.6% against the annual growth in July by 26.3% in annual terms and amounted to 639.9 billion tenge. Equity capital of LICs increased by 13.6% against a 16.8% growth in July (all year-on-year), to 153.7 billion tenge. The undistributed profit of LICs built up by 3.2% to 29.3 billion tenge in annual terms in August.     

Photos are from open sources.

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