RUSSIA: INGOSSTRAKH is planning to become a leader in home insurance

5 September 2018 — Marina MAGNAVAL
The home insurance penetration degree in Russia is quite low. According to the Director for retail insurance of INGOSSTRAKH Vitaliy KNYAGINICHEV - as of today, the total amount of insured housing property is 5-7%.

KNYAGINICHEV believes that the new law on home emergency insurance, which will come into force in August 2019, will not make a significant effect on this market, since 90% of premiums will be ceded in reinsurance. In order to get some positive visual effect the market needs about 5 years. However, the mentioned law will let insurers use new clients' data to develop and offer new products.

INGOSSTRAKH plans to become one of the home insurance leaders. The insurer is set to get 10% market share in the class before 2022. This class is of great interest for TOP-5 biggest local insurers who are trying to attract new customers through fully packaged insurance products as well as by offering them insurance for other types of property (like home equipment). Development factors in this regard for INGOSSTRAKH are underwriting, segmentation, digitalization, marketing, customer service, and agent network.

According to KNYAGINICHEV, the general situation in the segment of home property insurance shows a stable growing trend. For the last 10 years, the average annual growth rate was about 15%, which corresponds with the volume growth of new builds delivered. Under the law a federal database of home insurance property will be created (Automated Information System "Housing Property") at the expense of insurers and this database will be connected to online payment systems for claim payment and policy purchasing. From August 4, 2019, federal and regional authorities will be participants in the new database, as well as the Central Bank, insurers, and RNRC. ARIA will input data about insurance programs, maintain a register of contracts, claim cases, update an emergency risk map with aggregate liability of insurers, and accumulate data about insured persons.

The President of RNRC Nikolay GALUSHIN considers that the centralized system will simplify the working process, speed up information extraction, and also improve the processing and accounting of insurance contracts and losses. ARIA estimated cost of the project to be around RUB 1 billion and the period of implementation - 3-5 years.

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