"Greece Insurance Report Q3 2013" reports that the news flow and data
from Greece's insurance sector highlights three key themes. First, the
economic crisis has finally had a (brutal) impact on the non-life
segment. Second, premiums in the life segment have held up remarkably
well. Third, the consolidation of Greece's banking sector is something
of a wildcard, and may bring around a consolidation among insurance
companies as well.
The Greek insurers reported gross written premiums of EUR 1.02 billion in the first quarter of 2013 as compared with EUR 1.18 billion a year earlier, according to the 1Q2013 Report published by the Hellenic Association of Insurance Companies (HAIC).
Starting 14th April drivers will have to choose whether they will buy an MTPL insurance policy or give up their vehicles registration plates.
The paid claims due to the heavy rainfall that devastated the region of Attica and the whole territory of Greece by the end of February 2013 will be more than EUR 5 million, according to the first data published by HAIC.
Greek finance ministry considers to make property insurance against
earthquake and floods obligatory. According to daily Kathimerini, the
compulsory insurance of property against big natural disasters like
earthquake and flood is being considered by the finance ministry as an
attempt to forestall the possibility of a widespread economic damage
from an unexpected event such as an earthquake or flood.
With the total GWP reaching EUR 4.3 billion and a 10.71% drop in comparison with the previous year, one can say that the market is in serious trouble also for 2013. The total non-life gross written premiums reached EUR 2.37 billion. From EUR 2.69 billion in 2011 the fall stopped at 11.76%.
In 3Q/2012, the Greek insurance market managed to total EUR 3.22 billion, which means a 9.8% drop compared with the same period of 2011.
The Association of Insurance Companies in Greece wants to evaluate the impact of repurchasing Greek state bonds in order to create the conditions which will minimize losses.
The situation regarding the intentions of the Government to tax the premiums paid by an employer to an employee under a collective pension-saving plan as income remains uncertain.
Following the merger planned between the National Bank of Greece and
Eurobank groups, the linkup of their insurance activities will lead to
the creation of a domestic insurance giant with premiums of over 1.1
billion euros out of a total of 4.9 billion euros in the local market.
The insurance sector has stopped investing in state bonds since
incurring huge losses as a result of the private sector involvement
(PSI) in the Greek debt swap earlier this year.
Greece is characterized by its high seismic exposure. It is estimated
that the economic loss to the residential stock of a 1-in-200 year event
is likely to be greater than 22 billion Euros while for a shorter
return period 1-in-5 year it is likely to be 1.3 billion Euros.
From the beginning of 2012, the state and expectations of the Greek insurance industry have remained shrouded in the big "cloud" represented by the country's financial crisis.
Car owners in Greece will have to pay penalties for their vehicles by the beginning of autumn if they don't acquire an insurance policy. Fines will start from 250 up to EUR 1,000 depending on vehicles year of manufacture and engine volume. In case of non-payment, owners will be given an even higher fine and withdrawal of their license and plate numbers.
Mandatory civil liability insurance for all vessels that enter Greek ports remains on paper, as the implementation for the legislation imposed by relevant EU directive that was incorporated into Greek law in 2012 is yet to become active. The delay in enforcing the law is keeping Greek insurers away from a potential premium volume of EUR 100 million.
Insurance companies are less exposed than banks to contagion risk triggered by a Greek exit from the eurozone, because of insurers' ability to share losses with policyholders and their lower reliance on short-term funding. However, banks' resilience is enhanced by benefiting from any potential EU policy response and European Central Bank action.
Stress tests to insurance companies will be commencing normally this year also, in spite the transition period that was given to the companies in order to recover from their great losses over PSI+. These tests will determine the limits of the insurance market against plausible negative developments in capital markets, but also to disastrous or adverse insurance events.
Profits before taxes of the According Greek branch of HDI-GERLING for the fiscal year of 2011, reached EUR 6.2 mil, increasing y-o-y by 27% (EUR 4.9 mil in 2010). After tax profits closed at EUR 5 mil from EUR 3.8 mil in 2010. The results are in line with HDI-Gerling Hellas' goal of continuing its successful course against a harsh economic environment, remaining between the most profitable insurance companies in Greece for the last years.
Total premium production of the Greek insurance market for the 1Q 2012 appears to be reduced by 5%, but on the other hand in the Life associated with investments insurance branch premium production has increased by a staggering 79%, according with the research conducted by HAIC (Hellenic Association of Insurance Companies).
Data published by HAIC (Hellenic Association of Insurance Companies)
reveal that savers have turned their focus on Unit Linked programs
rather than term deposits. According to the data, in 1Q 2012, premium
production in the investment programs branch have increased by 79%,
while the total production of the sector has been enhanced by EUR 68.2
million Y-o-Y, reaching a total of EUR 154.5 million.