BAKU, Azerbaijan, Dec. 23
By Zeyni Jafarov – Trend:
Assuming the powers of a regulator by the Central Bank of Azerbaijan, which implements the control mechanism for the local insurance system, notably activated the local insurance market both in terms of fees and in the direction of the public insurance awareness, Elmar Mirsalayev, CEO of the Azerbaijani Insurers Association (AIA), told Trend.
According to Mirsalayev, owing to this the local insurance market coped to protect itself from negative elements, while the COVID-19 pandemic quite negatively affected many economic sectors.
He said that in the first 10 months of 2020 non-life insurance fees made up 59 percent of the total fees.
The non-life types of insurance include liability insurance, property insurance and personal insurance, which, depending to their purpose, are divided into compulsory and voluntary, respectively. As the real market indicators show, 60 percent of fees in this direction fall on voluntary types, while the remaining 40 percent - on compulsory types. The share distribution of the voluntary payments is estimated at 59 percent, and in compulsory ones - 41 percent.
Besides, the CEO stressed that currently the non-life insurance segment in the domestic insurance market is dynamically developing, despite the unexpected events of 2020, which created certain obstacles to fully achieving the predicted result in this market. The market activity for some products decreased significantly, while some insurance services showed a slight decline. Despite all these difficulties, serious damage was avoided as a result of the preventive measures taken.
Mirsalayev pointed out that the insurance market of Azerbaijan is quite young compared to other countries, since the Law on Insurance Activities was formed more than 10 years ago and at the moment the experience of neighboring and other developed countries is important.
“Naturally, the indicators of the economy of each country differ from each other and therefore, insurance products in each country have various dynamics of development. In Azerbaijan, about 99 percent of the insurance coverage accounts for compulsory motor insurance (OSAGO),” he said.
"For us, the main priority in the current situation is to increase the penetration by two or three times in both compulsory and voluntary insurance classes. We believe that if the current dynamics of development continues at a stable and growing pace next year, we will achieve this goal. Therefore, we can say with confidence that the insurance market of Azerbaijan is currently at a new stage of development," Mirsalayev summed up.