Licensing delays of new Life companies will not affect business in Azerbaijan

Business Materials 1 July 2011 13:58 (UTC +04:00)

Azerbaijan, Baku, July 1 / Trend A.Akhundov /

Three life insurance companies in Azerbaijan continue to stay strong in a compulsory insurance market at a time when the State Insurance Supervision Service under the Azerbaijani Finance Ministry is considering other companies' offers to create new life-companies. Yet even in such a market, these companies can still increase their portfolio, market participant Gafar Majidov said.

Ex- Executive Director of the Azerbaijani Insurers' Association Gafar Majidov is nominated for the post of chairman of the new life insurance company planned to be opened by the Ata Sıgorta insurance company.

The Law "On compulsory insurance on labor ability loss in production" took effect in the country in 2011.

"Companies that insured their employees may revise their contracts after a year and choose another insurance company. Companies will compete by offering better prices and better services in this market", Majidov said.

He said that the life insurance market is not limited to compulsory insurance on loss of production labor.

"The future is in voluntary insurance. The voluntary insurance market accounts for 60-70 percent in Europe", Majidov said.

There are only three life insurance companies licensed to provide life insurance services -Atesgah Heyat, Qala Heyat and Pasa Heyat. These operate in Azerbaijan today.

The State Insurance Supervision Service received several proposals which were not accepted due to shortcomings in documents submitted for obtainment of licenses. These documents were returned for revision. The Service received appeals from companies AzSıgorta, Alfa Sıgorta, Ata Sıgorta, and Standard Insurance. The International Insurance Company and Azərbaycan Sənaye Sıgorta also plan to open life insurance companies.
The premiums at Azerbaijani insurance companies for compulsory insurance on production labor ability loss reached 11.941 million manat in January-May 2011, or 37.12 percent more compared to January-April.

Total premiums on voluntary life insurance amounted to 1.344 million manat (1.55 percent of total fees), with payments of 77,274 manat (0.35 percent).

There were many premiums on life insurance worth 949,574,690 manat, with payments of 12,778 manat in Azerbaijan in January - May 2011.

Premiums on life insurance amounted to 394,211,350 manat, with payments of 64,496 manat.