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LIC premiums exceeded 200 billion tenge

The life insurance sector has increased the dynamics of premiums in the eleven months of 2020.
LIC premiums exceeded 200 billion tenge

In January-November 2020, LIC gross premiums increased by 14.6% (year-on-year) reaching a record 200.2 billion tenge. LIC Nomad Life collected 61.9 billion tenge for the same period and increased the gap in total fees from LIC Halyk life, which collected 61 billion tenge. It should be noted that LIC Nomad Life has become the leader among LICs in terms of assets (207.6 billion tenge) and insurance reserves (144 billion tenge). Moreover, in terms of assets, the LIC has surpassed even general insurance companies becoming the largest in terms of insurance reserves in the entire insurance market of Kazakhstan.

In terms of insurance segments, the life insurance sector remains the largest and fastest growing. For eleven months of 2020, it has increased by 23.1%, reaching 83.2 billion tenge, building up the share in total premiums of LICs to 41.6% in annual terms. According to the results of ten months, the share of life insurance premiums in total premiums of LICs was 40.9%.

LIC Halyk life still has the maximum portfolio of life insurance premiums.

In eleven months of 2020, the LIC portfolio has amounted to 33.4 billion tenge accelerating growth to 1.8% in annual terms. Despite the acceleration of positive dynamics, LIC Halyk life reduced its market share in the life insurance sector to 40.2% due to a more dynamic growth of premiums of other LICs.

The annual increase in life insurance premiums by 129.5% to 27.9 billion tenge shown by the life insurance company Nomad Life, allowed it to increase its market share in the life insurance segment to 33.6%. The company ranks second in the life insurance sector in terms of size of portfolio.

LIC European Insurance Company (EIC) remains the third largest player in the life insurance segment. At the end of eleven months of 2020, the LIC showed a decline in premiums by 20.7% (year-on-year) collecting 15.7 billion tenge and reduced the market share in the life insurance segment to 18.9%.

LIC Standard Life is consistently showing high dynamics of premiums. In January-November 2020, the growth of premiums of this LIC in the life insurance segment amounted to 77.7% (year-on-year), in January-October 2020 - 79% (year-on-year), in January-September, the premiums of this LIC increased by 78.4 % in annual terms. For eleven months of 2020, LIC Standard Life collected 1.5 billion tenge of premiums, its market share increased to 1.8%.

The annuity insurance sector has increased the positive dynamics of premiums for eleven months of 2020. The annual growth was 7.8% versus 6.6% in January-October (yoy). In absolute terms, the premiums rose to 69.6 billion tenge. However, premium dynamics cannot recover the high speed observed in 2019. A slow dynamics of annuity insurance premiums compared to the life insurance sector leads to a decrease in its share in the total premiums of LICs. As of eleven months of 2020, the market share of annuities has made 34.7%.

Retirement annuities being a part of annuity insurance have grown at a more vivid pace in January-November 2020 showing an increase of 8.7% (yoy). The total portfolio of LICs on retirement annuities amounted to 64 billion tenge, accounting for 32% of the aggregate LIC premiums.

LIC Nomad Life is still a leader of the segment of retirement annuities and the sector of annuity insurance. As of early December 2020, the LIC's annuity insurance portfolio amounted to 24.4 billion tenge accounting for 35.2% of this segment. As of early December, Nomad Life's retirement annuity portfolio has increased to 23 billion tenge and accounts for 35.9% of the pension annuity segment.

The second place in terms of portfolios is taken by LIC Halyk life. The company collected 16.7 billion tenge of annuity insurance premiums (occupied 24% of this insurance segment) and 14.6 billion tenge of retirement annuities (made 22.8% of this segment). According to the results of eleven months of 2020, LIC Eurasia is strengthening its position among the three largest LICs in annuity insurance. The company's annuity insurance portfolio grew to 9.1 billion tenge and made 13.1% of the annuity insurance segment. In terms of retirement annuities, the portfolio of LIC Eurasia reached 8.8 billion tenge forming a 13.9% share in the segment.

The Employer Liability Annuities (ELA) premiums for eleven months of 2020 have reduced the rate of decline. The total portfolio of LICs in this segment decreased by 10.2% (yoy) versus the annual decrease in premiums over ten months by 11.9% and the fall in premiums over nine months by 17.4% (yoy). In monetary terms, the fees of LICs on ELA amounted to 4 billion tenge.

According to the results of eleven months of 2020, LIC Halyk life has become the leader in the ELA segment. The company's portfolio in this segment has grown to 1,197 million tenge and occupies 29.7% of the ELA segment. LIC Nomad Life moved to the second place. The company's portfolio amounts to 1,192 million tenge and occupies 29.6% of the ELA segment. LIC KM Life remains in the third place. Following the results of eleven months of 2020, its portfolio has increased to 458.7 million tenge, and its market share has grown to 11.4%.

At the end of eleven months of 2020 the segment “Other types of annuity insurance” showed a high increase in premiums by 34.7% in annual terms. The LIC fees exceeded 1.5 billion tenge. The leading role in this segment belongs to two companies. LIC Halyk life collected 870.7 million tenge of premiums, though its market share in the segment reduced to 57.8% against 60.2% in January-October. LIC Nomad Life attracted 305.8 million tenge of premiums and made 20.3% of the segment. KM Life continues to strengthen its position in the third place. For eleven months of 2020, it has collected 266.2 million of premiums. The result will allow the LIC to increase its share in the segment to 17.7% versus 14.1% in January-October 2020. Due to the acceleration of premiums of other LICs, the share of two leading companies in the segment in January-November 2020 dropped to 78.1% against 81.8% in January-October and 89.4% in January-September 2020.

Accident insurance (AI) fees collected by LICs keep showing impressive growth. For eleven months of 2020, the aggregate premiums of LICs in this segment have increased by 34.4% compared to 2019 year-results and exceeded 11.8 billion tenge.

LIC Nomad Life performed the maximum increase in premiums by 415.2% in annualized terms enlarging the portfolio to 280.5 million tenge. Another high premium growth (344.8%) was shown by LIC Freedom Finance Life. The company's portfolio reached 2.9 billion tenge, the result allowed the LIC to keep the second place in the AI segment with a market share of 24.7%.

According to the results of eleven months of 2020, LIC Halyk life is in the first place. The company’s portfolio in terms of AI premiums collected exceeded 3 billion tenge, it allowed LIC Halyk life occupy 25.5% in the AI segment among LICs.

At the end of eleven months of 2020, the third position is held by LIC EIC. In January-November 2020, the company collected 2.3 billion tenge increasing its market share to 19.8% and outstripping LIC KM Life, which portfolio remained 2 billion tenge and decreased to 17.2% in the total AI premiums against 18.4% of the AI segment among LICs based on the results of ten months of 2020.

In January-November 2020, the concentration of the accident insurance sector among LICs has been stable. The three largest companies account for 70% of premiums collected among LICs.

The health insurance (VHI) premiums among LICs have been growing at a large-scale pace and for the eleven months of 2020 increased by 6051%, exceeding 1 billion tenge in annual terms. LIC KM Life plays the main role in premium formation. The company's portfolio exceeded 1 billion tenge and accumulated 93.9% of the premium segment. However, the market share of LIC KM Life for voluntary health insurance among LICs continues to erode in favor of other companies. Thus, the share of LIC EIC in the segment grew to 3.53% against 2.97% in January-October 2002, and the share of LIC Freedom Finance Life increased to 1.35% from 1.28% in January-October 2002.

The premiums in the Employee Accident Insurance in the Performance of Labor Duty (Compulsory Accident Insurance) sector continue to grow at a slow pace. In eleven months of 2020, the LIC premiums have increased by 2.3% to 34.3 billion tenge.

LIC Nomad Life is still an undisputed leader of the CAI segment. In January-November, the company's portfolio grew to 9.19 billion tenge and made 26.7% of total CAI premiums against the share of 25.9% in January-October 2020.

The second place is taken by LIC Halyk life, its portfolio has increased to 7.8 billion tenge and expanded its market share in the segment to 22.7% from 21.9% in January-October. The third position is held by LIC Eurasia with a portfolio of 5.2 billion tenge, which again has reduced the market share of the CAI segment, this time to 15.3%.

As of January-November 2020, the total assets of the LICs have increased by 37% (year-on-year) to KZT 581 billion. The insurance reserves make 410.7 billion tenge having grown by 25.5%. The equity capital of LICs increased by 37% (year-on-year) to KZT 106.7 billion.

Photos are from open sources.

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