Insurance Market of Ukraine in January-September 2022 collected UAH 28.6 bn (EUR 803.5 mn) of insurance premiums and paid out UAH 9.5 bn (EUR 267.2 mn), which is respectively 25.5% and 29% less y-o-y in local currency.
According to the National Bank, the activity of non-bank financial service providers continued to decline, and volumes of main financial services decreased. The volume of assets decreased in all categories of non-bank financial institutions (NBFIs) except for insurers. The share of NBFIs in total assets of the NBU-regulated financial sector shrank by 0.4 pp, to 11.8%.
By the end of September, the assets of insurers rose to UAH 71 billion, although from June last year to June this year they were at the level of about UAH 65.5 billion.
According to Forinsurer, in 9M2022, insurance reserves rose to UAH 39.9 billion (+25%) vs UAH 36.4 billion in the middle of this year and UAH 35.6 billion in September last year.
Insurers’ assets grew in Q3 2022 despite the decrease in the number of companies on the market. At the same time, volumes of gross insurance premiums and claims paid on non-life insurance declined in quarterly terms by 10% and 14% respectively.
TOP-10 Largest Non-Life Insurers in Ukraine by premiums written, 9М2022
|№||Insurer||Gross Insurance premiums written 9М2022, UAH mn||Insurance premiums written 9М2022, UAH mn|
|1||ARX||2 227||1 957|
|2||UNIQA||1 812||1 924|
|3||TAS IG||1 685||1 720|
|4||USG||1 392||2 270|
|5||ARSENAL INSURANCE||1 257||1 123|
|6||INGO||1 089||1 208|
TOP-5 Largest Life Insurers in Ukraine by premiums, 9М2022
|№||Insurer||Insurance premiums 9М2022, UAH mn||Сhange, %|
|4||PZU UKRAINE INSURANCE LIFE||293||-37,10|
Gross premiums of life insurers in Q3 decreased by 25%, while their claims paid rose by 5%. Assets of life insurers continued to grow.
Insurers showed high profitability in H2. This was largely due to a sizeable cut in expenses other than operating expenses. As of 1 December 2022, 15 insurers violated at least one of solvency and risk requirements, but some of them recovered their financial standing in Q4.
TOP-10 Largest Non-Life Insurers in Ukraine by insurance claims, 9М2022
|№||Insurer||Insurance claims 9М2022, UAH mn||Сhange, %|
TOP-5 Largest Life Insurers in Ukraine by claims, 9М2022
|№||Insurer||Insurance claims 9М2022, UAH mn||Redemption amount, UAH mn|
|4||PZU UKRAINE INSURANCE LIFE||34||16|
Over 40% of the market premium portfolio is traditionally occupied by motor insurance (MTPL, Motor Hull and Green Card summed). During the period of military aggression, the share of these types of insurance in the portfolio increased. The Green Card segment became the insurance business support driver, while the other segments recorded a drop in volumes.
The Ukrainian insurance market is working. The war has become a catalyst that showed the real situation of each insurer. Financially stable companies continue their activities and are being tested by the warAndriy Pyshny, Head of the NBU
Total number of insurance companies in Ukraine in the third quarter did not change – 137, of which 124 are non-life insurers and 13 are life insurers. Among insurers in the overall ranking in terms of premiums, USG is the leader (UAH 2.27 billion), occupying about 8% of the market, followed by ARX and UNIQA.
Such insurers have established their operational activities, remote settlement of losses, and even increased their liquidity (placed funds in banking institutions), invest in military bonds, and support the state.
In order to maintain market discipline and protect consumer rights, the NBU has resumed imposing corrective measures on participants of the non-bank financial services market for failing to submit reports, violating certain required financial ratios, and engaging in risky activities.
The full-scale war caught a number of nonbank financial service providers unprepared for the shocks that came with it. A large number of market players had to suspend or roll back their activities due to operational risks. Demand for basic financial services also slumped.
To gradually revitalize the nonbank financial sector, it is necessary to ensure that its participants can do business as usual and that the channels of financial service provision in wartime are effective. As part of this effort, a major focus should be placed on ensuring the physical and cyber security of the institutions and their customers and fortifying the institutions’ capability to provide services online.