LICs have shown impressive results by the end of September 2019. Considering that the results for nine months actually form the results of the year, we can assume that life companies will end the current year in positive territory.
Thus, the total gross premiums of LICs in September 2019 compared to the same period in 2018 increased by 1.5 times, to 139.1 billion tenge. Annuity insurance remains a growth driver in the life insurance sector. In annual terms, the premiums in this class of insurance increased by 133.6%, to 50.6 billion tenge. As of beginning of October 2019, the share of premiums on annuity insurance remained high (36.7%) in the total premiums collected by LICs.
All LICs working in annuity insurance showed a positive revenue result. Nomad Life is a leader in this class with the portfolio of 24.6 billion tenge or 48.8% of the total premiums in annuity insurance. Next is Halyk life with the portfolio of 18.5 billion tenge or 36.6% of the total annuity insurance premiums. Standard Life Insurance Group is the third with the portfolio of 4.7 billion tenge, or 9.4% of the total annuity insurance premiums.
Let us note that 90.8% of total annuity insurance premiums are held by pension annuity premiums that move annuity insurance up. From September 2018 to September 2019, pension annuity premiums have increased by 174.2%, amounting to 46 billion tenge as of early October 2019.
A new player appeared in the pension annuity class in September, it became a leader in dynamics of premiums. LIC Freedom Finance Life (the sixth insurer in terms of assets in the amount of 14.8 billion tenge, occupies 3.7% of the total LIC assets) has increased fees by 4367.5%, to 714.8 million tenge by the end of September 2018. And now it occupies 1.6% of the pension annuity market among LICs. LIC Nomad Life is in the second place in the dynamics of premiums of 216.5% (year-on-year). The company's portfolio is 22.7 billion tenge and is the highest in the class of pension annuities. LIC Nomad Life is a segment leader in terms of portfolio size and market share, which is 49.5%. The third place is taken by LIC Standard Life. The company slowed down and showed a dynamics of premiums of 198.5%, collecting 4.5 billion tenge, which is 9.8% of the total market of pension annuities.
The premiums in the employer liability annuity (ELA) class in September, 2019 increased by 3.2% to 3.6 billion tenge compared to September, 2018. Three out of five LICs collecting ELA premiums showed negative dynamics. Nomad Life is a segment leader with a premium of 1.5 billion tenge, which is 40.9% of the total premiums in this insurance class. LIC Halyk life is the second largest player in this segment and occupies 38% of the market with a premium volume of 1.4 billion tenge. The State Annuity Company (SAC) is one of the three largest ELA insurers. It has collected 421 million tenge in September and now occupies 11.4% of the market.
The ELA leaders showed different dynamics in attracting premiums by the results of September. The class “Other types of annuity insurance” has increased the decline in premiums by the end of September 2019. The fees decreased by 29.2%, to 927.8 million tenge compared to the same period last year. The fall seriously reduced the share of other annuities in total premiums of LICs, they amounted to 0.006% as of beginning of October.
The Life Insurance class in September 2019 increased by 50.6% (year-on-year) to 53 billion tenge. Thus, life insurance premiums in monetary terms exceeded annuity insurance premiums, reaching 38% in the total premiums of LICs.
All companies collecting life insurance premiums showed growth. LIC Standard Life demonstrated the maximum dynamics of 2389.6%, having had collected 598.4 million tenge. The company occupies 1.1% of the life insurance market. SAC continues to demonstrate stable dynamics, and compared to September 2018, it has increased the collection of premiums by 362.2%, to 1.8 million tenge. LIC Nomad Life also shows a three-digit growth, having increased the collection of premiums (year-on-year) by 113.3%, to 8.9 billion tenge.
LIC Halyk life is leading in life insurance segment. The company increased the premiums by 29.7%, to 26.3 billion tenge in September. Its market share is 49.7%. The three largest LICs Halyk life, Nomad Life and the European Insurance Company (EIC) occupy more than 96% of the life insurance market as before.
In September 2019, accident insurance premiums collected by LICs fell 3.8% to 6.9 billion tenge, whereas, the premiums showed growth, in August in annual terms. Four life insurance companies showed a positive trend in premiums, two - negative. LIC Standard Life has the maximum increase in premiums of 623.3%. LIC Nomad Life increased premiums by 64.7%. LIC Halyk life has grown in premiums by 11.6% only, which does not prevent it from remaining an accident insurance segment leader among LICs. The portfolio of LIC Halyk life in this insurance class is 4 billion tenge, and the market share is 58.3%. The second major insurer in this insurance segment (35% of the market) is LIC European Insurance Company (EIC) with a portfolio of 2.4 billion tenge. Both companies form 93.2% of the market.
The health insurance portfolio (VHI) among LICs continues to shrink. According to the results of September 2019, to the same period in 2018, it has decreased by 71.9%, to 14.3 million tenge.
Three LICs collect VHI premiums. The leader of the segment is LIC Standard Life with 9 million tenge of premiums. The company has increased the premiums as of September (year-on-year) by 73.6%. The company occupies 63% of the VHI market among LICs. The second largest company LIC Freedom Finance Life occupies 33.2% of the VHI market, increasing the premiums (year-on-year) by 3.1% to KZT 4.7 million.
The third market player LIC Halyk life reduced its activity. The company’s premiums fell by 98.7% compared to last year and amounted to 527 thousand tenge as of early October 2019. The company retains a market share of 3.67%.
The Compulsory Accident Insurance (CAI) class continues to grow. According to the results of September 2019, CAI increased by 11.9% compared to the results of last year's period, reaching 28.5 billion tenge. As of beginning of October 2019, CAI premiums occupy 20.5% of the total premiums of LICs.
Three LICs collecting premiums under CAI have increased revenue, and two reduced it during the reporting period. Let us note that the growth of all companies was higher than the market.
Halyk life owns the largest portfolio of 9.2 billion tenge (32.6% of the CAI market) even with the decrease in premiums of 23.5%. It is closely followed by Nomad Life, which has increased premiums by 17.8%, collecting 8.8 billion tenge and occupying 30.8% of the CAI market. LIC Standard Life returned to the top three in the CAI segment having had shown an increase in premiums of 84.4%, it raised 3.3 billion tenge, and took 11.9% of the CAI market share.
The stability of premiums allows LICs to increase assets. The total LIC assets grew by 26.4%, to 396.8 billion tenge in September 2019. Insurance reserves have increased by 29.1%, to 319 billion tenge. The profit of LICs has risen by 24.8%, to 14 billion tenge.
The maximum profit in the amount of 4.5 billion tenge was shown by Nomad Life. It generates 32.3% of the total LIC profit. Halyk life rose to second place with a result of 4.1 billion tenge (29.3% of the total LIC profit). The ESK fell to third place earning 2.9 billion tenge of profit, which is 21.1% of the total LIC profit.
Photos are from open sources.