ERGO was profitable in all tree Baltic countries
May 13, 2014
In
P&C insurance segment premiums of ERGO in the Baltic States totalled ca.
EUR 26 million. Main drivers in P&C segment were MOD, MTPL and Property
insurance. Excellent results were also obtained in life and
health insurance segments totalling EUR 13.2 million written premiums
with a growth of 19.7%. Such result was influenced by growing Life business
volumes via bancassurane channel and specialized life sales forces. Main drivers in life were Risk insurance,
Endowment insurance and Private pension insurance (annuities). Growth in health
reflects improving economic situation in the Baltic States as in most cases
organisations use the health insurance as a motivation tool, especially in
Latvia and Lithuania.
In the 1st Q of 2014 ERGO enhanced its financial strength and
stability even more: the investment portfolio of ERGO in the Baltic States grew
to EUR 292 million (EUR 281 million in the equal period 2013) as well as the
equity grew up till EUR 97 million (EUR 93 million in 1 Q 2013). Solvency ratio increased from 206% to 213%.
In the 1st Q of 2014 ERGO customers in the Baltic countries
were paid EUR 19 million claim benefits. Within this period one of the biggest
claims in Estonia due to fire in private property claim came up to EUR 0.37
million. In Lithuania the biggest claim due to fire in commercial property amounted
to EUR 0.2 million.
The
subsidiaries of ERGO in the Baltic States – ERGO in Belarus, ERGO Invest and
ERGO Funds – generated a profit during 1Q 2014 amounting to EUR 192 thousand. ERGO
in Belarus wrote more than EUR 1 million premiums.
Commenting the trends and prognoses of insurance
market in the Baltic States Dr. Bagdonavičius forecasts a
growth of Baltic insurance market with some exceptions. „Forecasts of ERGO in the Baltic States
show that economy of the Baltic States is recovering as well the volume
of P&C, life and health insurance businesses will continue to grow this
year. But from the long term perspective it is hard to forecast the growth due
to political environment. We are close neighbours of Russia and the falling of
growth in this country can influence our countries as well, both directly and
indirectly. The direct affect will be for business sector with commercial and
industrial business partners in the east. As well if foreign investments in Russia
shrink, attracting new investment to the Baltic countries could slow down. All
of this can lead to a lesser economic and insurance market growth”, Dr.
Bagdonavičius said.
According to Dr.
Bagdonavičius, one of most important projects for our organizations will be the
euro introduction (in Lithuania), as well SEPA (Single
Euro Payments Area) and FATCA (Foreign Account Tax Compliance Act). “ERGO
in the Baltic States can be proud of the 2-time successful transfer to the euro
currency within our organization in Estonia and Latvia. ERGO may feel now strongly
confident for the upcoming introduction of the euro in Lithuania, because it
can adopt the best practice and experience from its colleagues in Estonia and
in Latvia at any time”, Dr. Bagdonavičius said.
According to CEO at ERGO in the Baltic States, the entry to the Eurozone in Estonia and Latvia as well as Lithuania’s future entry will have a positive effect on the economy in the Baltic States. “Seen from the perspective of foreign companies, this is a step in the right direction for all three Baltic countries. Current experience strongly indicates that the euro will make the Baltic States even more attractive to foreign investors, will allow the Baltic States to strengthen economic growth, improve welfare and development”.
ERGO in the Baltic States
ERGO has been among leading insurance groups in the Baltic States and the only one to offer a complete range of coverage including non-life insurance along with life, pension and health insurance. Premiums of ERGO Baltic totalled EUR 155 million in 2013. Last year customers in the Baltic countries were paid more than EUR 85 million for insurance claims. ERGO is also present in Belarus offering services in the non-life sector. Over 550,000 customers in the Baltic States trust the services, know-how and financial stability of ERGO Group.
ERGO companies operating in the Baltic countries are part of the ERGO Group – one of the major insurance groups in Germany and Europe. Worldwide, the Group is represented in over 30 countries and concentrates on Europe and Asia.
ERGO is part of Munich Re, one of the leading reinsurers and risk carriers worldwide.
