BAKU, Azerbaijan, Feb. 24
By Yusif Aghayev - Trend:
Life insurance has great potential for development in Azerbaijan, Azer Aliyev, chairman of the Azerbaijan Insurers Association (AIA), told reporters in Baku, Trend reports.
Although in 2019, a significant decline amounting to 86.3 million manat ($50.7 million), which is 28 percent lower than in 2018 related to changes in tax legislation, was recorded in this area, there is every opportunity for further development, Aliyev noted.
“If we look at the statistics in this area in detail, the following trends can be noted. A significant decrease is observed in accumulative life insurance; if insurance premiums worth 253.9 million manat ($149.3 million) were collected for this type of insurance in 2018, last year their amount was 87.833 million manat ($51.6 million) less, which is a decrease of almost 35 percent,” the chairman added.
“This was related to the fact that, in accordance with the previous legislation in force, persons who took out insurance for surviving for a period of more than three years were exempted from paying mandatory social insurance contributions,” said Aliyev. “In 2018, these preferences were canceled, and the amount of income that an individual can channel for this type of insurance was limited to 50 percent. But, on the other hand, there is a slight increase in fees regarding death insurance, the amount of premiums collected increased by about 1 percent, reaching 48.5 million manat ($28.5 million).”
“Significant growth is demonstrated by such types of life insurance as disability insurance and insurance against incurable diseases,” the chairman noted. “Disability insurance premiums increased by 29 percent, amounting to 4.3 million manat ($2.5 million), while insurance premiums for incurable diseases increased by 26 percent, amounting to 356,000 manat ($209,411).
Also, in the field of compulsory insurance against industrial accidents and occupational diseases, the growth of premiums amounted to 12.8 million manat ($7.5 million), increasing to 48.1 million manat ($28.3 million) compared to 2018 (an increase of 36 percent), Aliyev added.
Using the right approach and the necessary set of instruments for influencing the market, significant success can be achieved in this segment, said the chairman.
The AIA was established in 2006 as a voluntary association of professional participants in the insurance services market. AIA includes 20 insurance companies, one reinsurance company and five insurance agencies.
Azer Aliyev was appointed chairman of the AIA board on Jan. 21, 2019. Azer Aliyev is also the chairman of the board of Ateshgah Sigorta insurance company.
Azerbaijan’s insurance companies collected insurance premiums in the amount of 681.1 million manat ($400.6 million) in 2019, which is 46.7 million manat ($27.4 million), or 6.4 percent less compared to 2018. At the same time, Azerbaijani insurance companies paid insurance indemnities worth 301.5 million manat ($177.3 million) in 2019, which is 61.2 million manat ($36 million) or 25.4 percent more than in 2018.
Presently, 22 insurance companies and one reinsurance company operate in Azerbaijan.
(1 USD = 1.7 AZN on Feb. 24)