Market participant: 2011 breakthrough for Azerbaijani insurance market
Azerbaijan, Baku, November 4 / Trend, A. Akhundov /
201 was a breakthrough year for the Azerbaijani insurance market, Nofel Rzayev, Board Chairman of insurance company Paşa Sığorta, reported in an interview publicized at the company's Website on Friday.
"After the insurance market narrowed in 2009 and 2010, exactly 2011 had to become a breakthrough year on the way toward a new state of insurance market, both quantitatively and qualitatively. Following the results of the first 9 months, we can say confidently 2011 may enter the history of insurance business of the country as a breakthrough year as the insurance market has started accelerating pace again," Rzayev said.
He noted that the results of operation in the nine months of the year, indeed, give Azerbaijani insurers enough grounds to hope for a successful end of the year.
"Insurance incomes in Azerbaijan in January-September 2011 totaled 165 million manat, of which 146.5 million manat were levied by insurers of general kinds of insurance, and 18.5 million manat-by life insurers. Thus, as compared to the first 9 months of last year, the insurance market sees a record high, almost 40 percent increase of insurance sales, and this, of course, can not help gladdening," Rzayev said.
He continued to say that it is very important to notice that the growth was achieved at the price of rather not new compulsory kind of insurance - insurance of employer's responsibility for accidents and professional diseases amongst employees - launched since 2011 but main kinds of general insurance.
"As for qualitative changes of the market, first of all we should note that the division of Azerbaijani insurance sector into general insurance and life insurance segments ended in 2011 and so did formation of three new specialized life insurance companies. The compulsory insurance on accidents and professional diseases at work, put in effect in the segment of life insurance, has contributed substantially to development of life insurers in Azerbaijan," he said.
Rzayev also stressed that the long-awaited process of reduction of the number of insurance market participants - at the expense of those insurers who failed to meet state's requirements on financial, technical and legal norms - has been in progress.
"Nevertheless, situation in this sphere remains complicated. Out of 28 insurance companies operating on general kinds of insurance and licensed by the state, 6 insurers did not collect even one million manat of insurance payments each following the results of first 9 months of 201. Limited in their capability of investing in the logistics base and personnel development, such companies discredit the image of the insurance industry and a professional insurer-strong, reliable, professional partner. From the point of international practice, each of Azerbaijani insurance companies enters, to a certain extent, foreign insurance markets to buy reinsurance capacities, and even a littlest technical mistake in this process creates the wrong image of Azerbaijani insurers on the whole. As practiced internationally, mergers of insurance companies are quite essential in such case," Rzayev said.
Currently, there are 28 insurance companies and one reinsurance company operational in Azerbaijan. The operating license of one insurance company - Fidan Sığorta - has been suspended. There are also three life insurance companies - Atəşgah Həyat, Qala Həyat и Paşa Həyat - operational in Azerbaijan.
The official exchange rate on November 4 is 0.7868 AZN/USD.