November 2019 turned out to be very eventful in the life insurance market. LICs increased their profit by 61.3% compared to the results for the same period in 2018. Life insurance again became a leader: in the first 11 months of 2019, life insurance premiums were ahead of annuity insurance fees, and the leader in the CAI sector changed.
In November 2019, the total gross premiums of LICs have increased by 58.2% or by 64.2 billion tenge compared to the results of the same period in 2018, reaching 174.6 billion tenge. Life Insurance regained the title of the largest segment in the LIC portfolio. The share of life insurance premiums in the overall LIC portfolio increased to 38.7% and became dominant. Over the 11 months of 2019, premiums in the life insurance segment have amounted to 67.6 billion tenge showing an increase of 44.1%.
Despite the fact that seven insurance LICs have been already collecting premiums in the life insurance segment, large companies ensure the dynamics of fees. LIC European Insurance Company (EIC) has increased premiums by 59.9% to KZT 19.8 billion (year-on-year) and takes the second place in the segment with a market share of 29.4%. LIC Nomad Life has raised its fees by 39.3% collecting 12.2 billion tenge and holds the third position with a market share of 18%. The segment leader Halyk life insurance company has increased premiums by 35.9% collecting 32.9 billion tenge and makes 48.6% of the life insurance market. The premiums of these three LICs account for 96% of the life insurance segment. It is important to note that EIC and Halyk life reduced their market share in November, while Nomad Life increased its share in the life insurance segment. LIC Standard Life showed the maximum dynamics of premiums in November. The company has increased fees by 516.7% collecting 855.1 million tenge of premiums and occupies a 1.3% share in the total premiums of life insurance companies.
Annuity insurance remains a significant segment of the LIC business, although by the end of November annuities were slightly inferior in terms of the volume of premiums collected by the life insurance segment. In November 2019, the total amount of premiums in annuity insurance amounted to 64.5 billion tenge showing an increase of 126.4% compared to the results of 2018, occupying 36.9% in the overall portfolio of LICs. Nomad Life retains its leadership in the segment. Its premiums amount to 30.7 billion tenge and make 47.6% of total premiums of LICs on annuity insurance.
Retirement annuities remain the driving force of annuity insurance occupying 91.3% of its share. The total LIC fees in the retirement annuity segment grew by 161.8% reaching 58.9 billion tenge. All companies operating in the retirement annuity segment showed a positive revenue result.
LIC Freedom Finance Life showed a phenomenal dynamics of premiums of 9330.2% (year-on-year). The premiums made up 2.4 billion tenge in absolute terms allowing the company to occupy a 4.1% share of the retirement annuity segment.
LIC Nomad Life with a market share of 48.3% and premium of 28.4 billion tenge remains the main player in the segment of retirement annuities. According to the results as of November 2019, the company increased premiums by 173.8% (year-on-year).
LIC Halyk life, the second major player in the retirement annuity segment, has increased the premiums by 166.5% collecting 20.5 billion tenge (year-on-year) and occupies a 34.8% share in the total portfolio of retirement annuities as of end of November 2019.
LIC Standard Life, the third major player in the segment, showed premium growth of 73%, collecting 5.8 billion tenge (year-on-year), and occupying 9.8% of the retirement annuity segment as of end of November 2019. The three leaders make 92.9% of the retirement annuity segment.
Employer Liability Annuities (ELA) premiums continued to decline in November shrinking by 1.4% to the amount of insurance premiums in November 2018. The fees amounted to 4.5 billion tenge occupying 2.5% of total premiums of LICs in absolute figures.
LIC Halyk life increased premiums by 119.4% compared to November 2018 collecting 1.720 billion tenge of premiums. The share Halyk life in the total portfolio of LIC in ELA is 38.3% being the second.
LIC Nomad Life keeps the first place in terms of premiums (1.788 billion tenge) and market share (39.6%). LIC State Annuity Company (SAC) is in the third place. The company collected 489.3 million tenge of premiums in November occupying 10.9% of the ELA segment.
The “Other types of annuity insurance” segment continued to fall in November, 2019. As of same period last year, fees decreased by 22.6%, to 1.1 billion tenge. Negative dynamics keeps the share of other annuities in the total premiums of LICs at extremely low level of 0.006%.
Accident insurance premiums (AI) collected by LIC reduced their fall to 3.6% in November 2019, compared to last year 8.8 billion tenge. The segment occupies 0.5% in the overall portfolio of LICs. Three LICs showed a positive trend in premiums, two - negative, one - neutral.
LIC Nomad Life had the maximum increase in premiums of 765.9%; it allowed the company to occupy 0.6% of the Accident and Health Insurance market among LICs. Halyk life is a leader in the segment with a market share of 56.1%, which continues to decline in favor of other companies. In November, Halyk life increased premiums by 23.6% collecting 4.9 billion tenge (year-on-year). EIC, the second major player in the segment of AI, reduced premiums by 22.2% in November compared to the results of the same period in 2018 collecting 3.1 billion tenge. The result allowed EIC to retain a market share of 35.5%. Freedom Finance Life is in third place with a premium of 657.4 million tenge. The fall in premiums in November by 40.9% to the end of 2018 retained its market share of 7.5%. LIC Halyk life and EIC form 91.6% of premiums in the AI segment; their share begins to spread in favor of other companies.
Health insurance portfolio (VHI) among LICs continues to shrink. As of November, 2019, compared to the same period in 2018, it has decreased by 61.5%, to 17.3 million tenge.
Three LICs collect VHI premiums. The segment leader with a share of 57.8% is LIC Standard Life. It increased premiums on voluntary health insurance by 56.1% to 10 million tenge in November 2019 (year to year). The second large company, LIC Freedom Finance Life, raised premiums by 27.5% to KZT 6.5 million, which allowed it to increase its share in the segment to 37.89%. The third market player, LIC Halyk life, dropped premiums by 97.7% as of end of 2018, to 756 thousand tenge. The company retains a market share of 4.35%.
The premiums in the segment “Insurance of an employee against accidents in the performance of his labor duties” (CAI) continued to grow in November. The dynamics has amounted to 30.3%, which is much stronger than the result of October, 2018. The total CAI premiums grew to 33.6 billion tenge and made 19.2% of the total premiums of LICs.
For the reporting period four LICs collecting CAI premiums have increased revenue, and one LIC reduced premiums.
The leader in the CAI segment has been replaced in November 2019. LIC Nomad Life took the first place in terms of premiums and market share. It collected 10.6 billion tenge of premiums (an increase of 12.5%) occupying 31.6% of the CAI segment. The former leader Halyk life showed revenue of 10.1 billion tenge (an increase of 10.5%) and made 30.3% of the segment.
LIC Standard Life, the third largest insurer in the CAI segment, collected 4.1 billion tenge of premiums (an increase of 57.1% was the best dynamics in this segment of LICs) occupying 12.3% of the CAI class. As of November 2019, Halyk life made 40.6% of total premiums, Nomad Life - 30.9%, EIC - 13.2%
In November 2019, the total assets of LICs showed a significant increase to the end of 2018 rising by 33.9%, to 424 billion tenge. Halyk life and Nomad Life remain the largest LICs; they form 71% of all LIC assets. Insurance reserves increased by 27.1%, to 327.3 billion tenge. The consolidated retained earnings of LIC increased by 61.3%, to 21.1 billion tenge. According to the results of November 2019, Nomad Life was the most profitable LIC. The company's profit has increased by 196.5%, to 7.1 billion tenge and forms 33.8% of the total profit of LICs.
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