ERGO in the Baltic States in 2013: growth in premiums and benefits paid out to the customers
August 15, 2013
According to an IFRS-based assessment, ERGO in the Baltic States in the half year of 2013 wrote
EUR ca. 77 million premiums, which resulted in a growth of 6%. Positive result has been achieved in ERGO life and health insurance – in these segments ERGO amounted to EUR 1.1 million profit and grew more than twice. In the 1-2 Q quarters ERGO customers in the Baltic countries were paid 5.2% more claims compared to the equal period last year – EUR 44.7 million.
According to Dr. Kęstutis Bagdonavičius, Chairman of the Management Board of ERGO in the Baltic
States, the main driver of growth in ERGO P&C segment was MOD, MTPL and Accident insurance,
while the growth in life insurance segment was influenced by growing life business volumes via bancassurance channels as well as by an excellent development of health insurance in all three countries. “Our turnover is growing consistently and this is demonstrating continued progress and the benefits of our multiple and balanced sales channel approach as well as of the wide spectrum of insurance products. It
is important to move towards personal and high value creation for the customer in service channels that the customers prefer as our customers have become more demanding, conscious and particular”, Dr. Bagdonavičius said.
In P&C insurance segment premiums of ERGO in the Baltic States totalled ca. EUR 55.3 million, what shows 2.5% growth compared to the last year. Good results were also obtained in life and health insurance segments totalling EUR 21.5 million written premiums with a growth of 15.8%.
ERGO in the Baltic States in life and health segments has showed twice growing profit compared to the equal period last year. The profit of EUR 1.1 million was influenced by positive technical and investment
result as well as by profit earned from additional insurance, i.e. Additional accident insurance, Critical illnesses insurance.
In the 1-2 Q of 2013 ERGO customers in the Baltic countries were paid EUR 44.7 million claims. Within this period even two property claims in Estonia and Latvia due to fire and explosion amounted to EUR 1.1 million and that was one of the reasons of not achieving a positive result in P&C insurance segment.
The subsidiaries of ERGO in the Baltic States – ERGO in Belarus, ERGO Invest and ERGO Funds – generated the profits during the half year and earned twice as much profit as within the equal period last year amounting to EUR 646 thousand profit.
Commenting the trends and prognoses of insurance market in the Baltic States Dr. Bagdonavičius emphasizes the growth of Baltic insurance market. „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. However, the business environment remains difficult owing to the low interest rates and that will push risk carriers to focus more on insurance risk“.
According to Dr. Bagdonavičius, another trend driving the future insurance market development is the increase of transparency and this opens opportunity to insurers to compete by the quality of service and level of
reliability. „As the market becomes more transparent, consumers’ expectations toward insurance
companies are growing. Customers want simpler, easy-to-understand products, great customer experience and loyalty rewards. Aligning companies’ products and processes accordingly will be one of the most important conditions for staying competitive on the market”, Dr. Bagdonavičius says.