Experts describe reasons for reduction in Azerbaijan’s insurance market

Azerbaijan, Baku, April 10 / Trend , corr. U.Ismaylova /  

In 2008 the global financial crisis did not affect the insurance market of Azerbaijan, since the premiums increased 21.1 percent (179.26 million manats), payments - 35.5 percent (49.81 million manats) compared to 2007. However, the insignificant influence of the global crisis on the insurance market started to be felt starting from 2009, said the experts of Financial and Economic Studies Consulting LTD. 

The influence of crisis is connected with the reduction of some types of insurance, such as automobile, mortgage insurance, insurance of property, which played an important role in the development of market.

In this situation, the growth rates in the Azerbaijan insurance market will not exceed 15-20 percent in 2009 compared to last year.

The basic reason for reduction on the Azerbaijani insurance market is the reduction and even stopping of crediting by the local banks, with which active bank operations were held. In this situation, insurers should re-construct their companies, search for new clients and provide new insurance products, experts said.

Stimulus for the development of market, and also base for the revision of its activity can be provided also by approval Law on Required Insurance, which is now under consideration of government.

The Law on Required Insurance includes five types of insurance - required insurance of the responsibility of car owners, required insurance of responsibility before third face because of fire, required ecological insurance of object with the potential danger, required insurances of passengers, required insurances of workers on the construction work.

Official rate on April 10 is 0.8032 AZN/USD.