Azerbaijan, Baku, August 19 / Trend , U.Ismaylova /
Reduction of the insurance market of Azerbaijan could lead to bankruptcy and liquidation of the weakest companies, said the deputy chairman of the Azergarant Sigorta insurance company Shukur Huseynov.
"They can be those companies that develop their business, mainly due to banking operations and with weak financial reserves," said Huseynov.
According to him, such a situation is natural, if large part of the portfolio of the companies was formed due to the banking operations, which have now suspended providing risky loans, and if the insurer has no extra premiums, then they have to make payments on long-term contracts.
Despite this situation, market growth continues, because in Azerbaijan only five or six companies developed their business mainly due to banking operations, said Huseynov.
Speaking of the projections until the end of the year, Huseynov said that although small, but growth is still expected.
Some 28 insurance and one reinsurance company function in Azerbaijan. As a result of activities in 2008, the companies collected premiums in amount of 179.26 million manat, with 49.81 million manat payment. In the first half of 2009, premiums totaled 79.89 million manat, with payments totaling 24.65 million manat. Collections of the companies over six months decreased 17 percent.
Azergarant JSC has been operating in the insurance market since 1993 and provides 26 kinds of insurance services, four of which are obligatory. The authorized capital of the company is 1.8 million manat, profit - 237,100 manat.
Official rate on August 19 is 0.804 AZN/USD.
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