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The leader in annuity insurance has changed

LICs have reported on the results as of April
The leader in annuity insurance has changed

The total gross premiums of LICs in April, 2019 have increased compared to the same period last year by 55% (by 18 billion tenge), reaching 51.4 billion tenge. Life insurance remains the most capacious type, occupying in total gross premiums 39.7% or 20.4 billion tenge. In April, the revenue of LICs has increased by 42.4% (by 6 billion tenge). However, according to the National Bank statistics life insurance portfolio is shrinking in the total insurance portfolio of life insurance companies. This March the share of life insurance premiums was higher - 44.2%. Now it is decreasing due to the aggressive growth of other segments.


In terms of life insurance companies, small companies continue to show a significant increase in premiums.

LIC Standard Life showed the maximum dynamics - 3796.6% occupying 1.4% of the life insurance market being the fourth among LIC in assets - 32.6 billion tenge. The State Annuity Company (SAC) has become the second in premiums - 599.2%, third in terms of assets - 36.8 billion tenge. The top three is closed by LIC Freedom Finance Life with the dynamics of premiums of 308.4% (1.9% of the life insurance market, the sixth player in assets of 11.7 billion tenge). Back in March, Freedom held 0.7% of the life insurance market. Still, more than 96% of the life insurance market is occupied by the three largest LICs: Halyk life, Nomad Life and the European Insurance Company (ESC).


At month end April annuities have become the most dynamic type of insurance: premiums have doubled from 7.9 billion to 18.4 billion tenge. Since the retirement annuities make the structure of annuities, their growth by 2.7 times, from 6 to 16.5 billion tenge, has affected the results of the whole class of annuities. Contracts in the employer liability annuity class have increased by 9% to 1.55 billion tenge.


The news of the month is a change of leader in annuity insurance and retirement annuities. Nomad Life has become one. The company's premiums in April were growing slower than the market growth rates. Their dynamics amounted to 114.3% and 140.8%, respectively (year to year). However, in absolute terms the company showed the maximum result. 7.3 billion tenge were collected in retirement annuities and 8.1 billion tenge in annuity insurance in general. This allowed LIC Nomad Life get the leading position in market share. The company holds 44% of the market for pension annuities and 44.1% for annuity insurance. Besides, the company remains the leader in the employer annuity liability class with a market share of 44.7% in annuities and the maximum premium collection of 696 million tenge.


LIC Halyk Life took the second place in retirement annuities and annuity insurance. It collected 4.9 billion tenge and 5.7 billion tenge, respectively.

It should be noted that the company ranks second in the employer annuity liability class with a premium of 566 million tenge. LIC Halyk Life has expanded its market share on retirement annuities to 30.2%, on annuity insurance to 31.2%, on employer annuity liability to 36.3%.


The former market leader LIC Standard Life went down to the third place. In terms of pension annuities, the company's market share was 21.5%, and in general, annuity insurance - 19.5%.


The class of other types of annuity insurance showed a decline of 21% decreasing from 492 million to 388 mln tenge.


Accident insurance (AI) premiums amounted to 2.3 billion tenge. Halyk Life has the largest portfolio of 1.3 billion tenge. The company occupies 55.4% of the market. The EIC is second occupying 38.9% of the market with a portfolio of 904 million tenge. Together, both companies occupy 94.4% of the market.

Health insurance (VHI) continues to be an area of interest for a limited number of LICs. The portfolio of VHI in the LIC section does not exceed 3.8 million tenge. The segment leader LIC Standard Life with premiums of 3.3 million tenge occupies 86.8% of the market. LIC Freedom Finance is second being the fast growing company in this class of insurance. The company's portfolio is 0.3 million tenge, and the company occupies 8.3% of the market.

Halyk Life is in the third place with a market share of 4.88% and premiums of 0.2 million tenge.

The employee’s accident insurance during the performance of professional duties (CAI) has lost 28% of the premiums or 3.9 billion tenge in April compared to last year’s results. By early May, 2019 LICs have collected 10.2 billion tenge, except for SAC almost all LICs collecting premiums on CAI have increased revenue. The leader in terms of premiums has become Nomad Life, which has collected 3.4 billion tenge. The result allowed the company to move to the first place in the segment in terms of portfolio share (33.4%).

Next is LIC Halyk Life, which has collected 3 billion tenge premiums, but lowered the market share to 29.9%. In March, the company occupied 36.4% of CAI market. Standard Life Insurance Company is in third place, as previous month. The premiums amounted to 1.6 billion tenge, occupying 15.9% of the CAI market. The company's market share has dropped compared to the last month.

A steady and high premium collection allows LICs to increase assets and insurance reserves. The LIC assets as of April (year to year) have grown by 25.6% to 353 billion tenge, insurance reserves have increased by 24% to 281 million tenge. As a result, the total retained earnings of LICs have grown by 22.7%, from 5.4 billion tenge to 6.6 billion tenge.

The maximum profit margin was again shown by Nomad Life. The company’s retained earnings amounted to 2.75 billion tenge. LIC Halyk Life was second with 1.7 billion tenge, EIC was third with 1.3 billion tenge. LIC Standard Life reduced its loss from 219 to 33 million tenge.



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