Tashkent, Uzbekistan (UzDaily.com) -- The current state of the insurance market and the results of the first quarter of 2020

Insurance services are one of the means to protect the economy from various financial risks. Therefore, the insurance industry is an integral part of the economy.

In order to bring analytical information in the field and information about the current state of the insurance market and the results of the first quarter of 2020 to the General public The Agency for the development of the insurance market under the Ministry of Finance of the Republic of Uzbekistan organized a round table.

At the end of the first quarter of, the volume of insurance premiums amounted to 0.5% of GDP, insurance premiums per person amounted to 14.7 thousand soums.

Currently, 36 insurers operate in the insurance market of the Republic of Uzbekistan, including 28 in the general insurance network, 8 in the life insurance network, as well as 5 insurance brokers, 5 actuarial organizations and 22 assistants, adjusters and a surveyors. According to insurance companies, at the first quarter of 2020, insurance premiums in the amount of 503.1 billion soums were collected. The total authorized capital of insurers amounted to 782.4 billion soums (an increase of 138%), and the volume of investments in the economy amounted to 2,834.9 billion soums (an increase of 137%). 55% of investments are in bank deposits, 30% in shares, and the rest in other securities. The number of existing contracts is 7.0 million.

Insurance payments in the amount of 176.9 billion soums were made in the first quarter of 2020, of which 141.2 billion soums were paid for non-mandatory types of insurance and 35.8 billion soums for mandatory types of insurance.

During the reporting period, the number of insurance departments reached 1773. The staff of insurers includes 6.6 thousand employees and 8.9 thousand insurance agents.

It is important to note that there is an imbalance in the components of the insurance market in our country, that is, optional types of insurance make up 82%, and mandatory types - 18%. In developed countries, the share of mandatory insurance is 50%.

To date, 36 insurance companies operate in the country, and 45% of the total volume of services in the insurance market is accounted for by the first 5, and 69% - by 10 companies. This indicates that the potential of the insurance market is not fully realized. In addition, the share of life insurance in other countries is 50 percent, and in our country it is only 16 percent.

In the global insurance market, insurers provide more than 1000 types of insurance services, 300 of which are aimed at life insurance taking into account the needs and desires of the insured. In our country, however, many types of insurances, such as obligations of financial institutions, obligations of directors and managers to shareholders, have not been established. According to the analysis, there are a number of problems in this area, which are specific not only to our republic, but also to other countries. These were mainly explained by the lack of effective communication between the insurance companies, the insured, the low efficiency of the service due to the delayed response to customer requests.

The high geographical concentration of the insurance market is another issue. The main share of insurance premiums - about 66% - falls on the city of Tashkent and Tashkent region.

Excluding payments in the life insurance network and compulsory insurance, the loss rate in the general insurance network was only 9%, indicating that there were almost no payments for non-mandatory insurance.

Meanwhile, almost all life insurance companies also failed to provide last year’s level of insurance premium receipts.

The majority of complaints to the Ministry of Finance from customers of insurance companies are related to payments, and after the consideration of complaints by the Ministry, insurance companies repaid 4.5 billion soums.

It was noted that as most citizens were not aware of insurance and types of insurance, the implementation of the same measures by insurance companies from year to year, leaving advertising costs low weren’t sufficient to change the situation.

As a result of strong winds and rains in Bukhara, Navoi and Kashkadarya regions this year and flooding of the Sardoba reservoir in Syrdarya region on May 1 this year, many houses, greenhouses, agriculture and many infrastructure of the economy were severely damaged. In this case, insurance companies were instructed to make their payments only through insurance premiums. The Insurance market development agency reported on the work done and being done in this regard.

In particular, 1383 insurance contracts were concluded in Ak Altin, Mirzaabad and Sardoba districts of Syrdarya region, of which 839 were property insurance.

365 insurance contracts were concluded with business entities, and insurance premiums in the amount of 882.5 million soums were paid for damaged property in a short period of time.

Of the 474 insurance contracts concluded with citizens, 212 are residential buildings insurance. All of the above-mentioned residential buildings were damaged, and insurance companies are working on the implementation of insurance payments for these residential buildings. To date, insurance premiums in the amount of 78.9 million soums have been paid. Applications for insurance payments amounted to another 2.5 billion soums have been received.

At this stage, we also urge the population to pay more attention to their property and protect it from various disasters. As a result of the natural disaster in Sirdarya, 4351 houses were seriously damaged, and only 212 houses were insured.

As a result of a natural disaster in the Bukhara region, many houses, greenhouses and other property were damaged in the Alat and Karakul regions, as well as in some areas of Kashkadarya, Navoi and Samarkand regions.

About 30,000 insurance contracts have been signed in these regions. Today, 4.5 billion soums have been paid for damaged facilities. Work in this direction is in progress.

During the discussions, it was noted that effective communication between insurance companies and the population, timely response to customer requests, ensuring the effectiveness of services, including a wide range of issues aimed at expanding the range of insurance services in the country, are important.