Azerbaijan, Baku, Oct. 7 / Trend A.Akhundov N.Ismayilova /
The Azerbaijani insurance market observes last year's decline trend, but a period of development comes after each crisis, Finance Ministry Ministry's State Insurance Supervision Service Head Namig Khalilov said.
"We are observing last year's trend in the insurance market, as in the banking sector. This process should pass certain steps, and sooner or later, after each crisis, a period of development, comes," Khalilov said.
Currently, he said, the insurance companies meet the requirements of the State Insurance Service.
"Basically, the insurance companies operating in the country meet the requirements of the Service. Now we are concerned about just what problems may arise after Jan.1, 2011," Khalilov said.
The Azerbaijani Insurers Association appealed to the Finance Ministry to reschedule the capitalization of insurance companies, Namig Khalilov said earlier. Based on the current schedule, as of Jan. 1, 2011 the insurance companies had to bring the total capital to at least 3.5 million manat. The insurers want to delay the capitalization schedule to 2013.
"The association proposes to amend the capitalization schedule, as well as it has questions about licensing and investment," Khalilov said." We are currently considering these proposals, and believe that, there is a need to make changes on these issues in some form."
"Probably, specific requirements will be adopted by late 2010," Khalilov said.
According to the approved minimum capital requirements to the insurance companies, as of Jan. 1, 2010 the insurance companies had to bring the total capital to 2 million manat, and reinsurance companies to four billion manat. As of Jan.1, 2011 this was set to rise to 3.5 million manat and seven million manat respectively, and as of Jan.1, 2012 it was set to rise to five million and 10 million manat, respectively.
The total premiums fell by 21.64 percent in January-July 2010 compared to the same period of 2009 (113.02 million manat) and payments declined by 8.15 percent (29.19 million manat).
In 2008, the growth of the insurance market was 22 percent compared to 60 percent in 2007. The insurance market continued to observed a decline in January-August 2010 and the total premiums fell by 15.98 percent compared to the same period last year.
There are 27 insurance and one reinsurance company in Azerbaijan.
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