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Competition is growing in the Kazakhstan insurance market

There are 28 insurance companies in the Kazakhstani market; eight of them are life insurance companies. Two new life insurance companies appeared in the domestic market and three general insurance organizations left it in 2019.
Competition is growing in the Kazakhstan insurance market

Regulatory tightening of the insurance market increased competition, and the coronavirus pandemic intensified the rivalry of insurers many times. “We expect competition to remain strong in the corporate and retail insurance segments. Competition might intensify for life insurance companies, but this will not lead to significant changes in the next 12-18 months,” says Yekaterina Tolstova, the Deputy Director of the Financial Institutions Group at S&P Global Ratings.

In accordance with the National Bank’s statistics, the volume of investments in financial and insurance activities for four months of this year has amounted to 21 billion tenge; this is 3.1% more than in January – April 2019. “More shareholders working in the insurance industry are interested in life insurance companies, they see this industry growing and developing successfully,” explains Yelena Taitugoleva, the Managing Director of Nomad Life.

According to Halyk-Life, the struggle for customers will be less fierce in the endowment life insurance sector as this service requires an inflow of financial and, most importantly, human resources, and there has been a shortage of qualified insurance agents in the Kazakhstani market for many years. “Competition will increase in such markets as compulsory accident insurance for employees, retirement annuity and loan insurance,” predicts Aigul Boranbayeva, the Managing Director of Halyk-Life.

Insurers of both segments of the sector (Life and General Insurance) are focused on introducing new technologies. “To be successful in current realities, one has to be better and smarter than others,” says Shakir Iminov, the Executive Director of Eurasia Insurance Company. - Our goal is to create a digital insurance company for clients, which offers very simple, technologically advanced, positive online products and processes offering a cool experience of customer interaction with an insurance company.”

Amanat and Nomad Insurance have pretty much the same strategy, introducing online technologies and simplifying services. “We are not planning to expand the product line. (...) We simplify the terms and conditions of the products, organize and standardize insurance offers so that customers perceive information on them easily,” explains Anna Nekryukova, the Board Deputy Chairman of Amanat Insurance Company.

“The main task is to keep the existing portfolio. We are working on service improvement to attract new customers, working on expeditious processing of applications and decision making. We are developing online sales platform for convenience and affordability to customers,” says Dauren Imanzhanov, the Board Chairman of Nomad Insurance Company. The organization’s specialty was developed during the pandemic. “Traveling abroad people are required to undergo testing for Covid-19, and this is an additional cost loading. In cooperation with one laboratory we have developed an affiliate program with a discounted test price for clients,” Dauren Imanzhanov shares his experience.

Kommesk-Umir has also gone digital, but will also promote affiliate programs that include insurance product in non-insurance services. “Soon there will be a renewed property insurance product for individuals. There is also a new product for car owners,” says Oleg Khanin, the Board Chairman of Kommesk-Umir Insurance Company.

Market participants and analysts agree, the coronavirus pandemic is likely to affect company revenues, but any crisis is time of opportunities; and financial experts do not intend to miss them.

Photos are from open sources.

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