STATISTICS: CZECH Rep.: Mild recovery, but still dealing with the MTPL line's imbalances

According to third-quarter figures of the Czech National Bank, the sector's supervising authority, the Czech insurance market development shows no unexpected major changes. Annual premiums totalled CZK 120.23 billion, 2.6% up y-o-y. Both life and non-life insurance segments saw a positive evolution in terms of GWP.

Life insurance saw a higher dynamic than the non-life segment (4.24% for life insurance, 1.28% for the non-life segment). Still, as the Czech Insurance Association's figures show for the same period, a large part of the premium's increase came from the cross-border business via branches or under FOS. Excluding this segment, life insurance premium underwritten by the Czech insurers increased only by 0.3%.

On the non-life business segment, GWP for the "damages to property" and MTPL lines recorded the highest growth rates, of 9.8% and 8.74% respectively. In part, growth on the MTPL line came, as stated by the CAP representatives, from the tariffs increase during the year. However, as stated by Jakub HRADEC, executive director of the Czech Insurers Bureau, "the current level of price increases for MTPL insurance only covers payments into the fund for loss prevention. Prices for this type of insurance decreased gradually over six years to the very bottom, so that it can be expected the re-growth of premiums at adequate levels will take several years. With certainty we can therefore say that motorists will have to prepare for higher prices in the coming years. "

In fact, although at the non-life insurance market level claims expenses decreased by about 2.8% y-o-y, for the MTPL line a 3.22% increase in claims paid was recorded. "It turns out that our last estimates predicting a rise in the cost of compensation for immaterial loss of EUR 2 billion as a result of changes in the new Civil Code are hereby confirmed. Average damage to health increased by 50% to CZK 600 thousand, "explained Tomas SIKORA, CAP's Executive Director. Up to the present moment, Czech motor insurers already paid about CZK550 million to the Loss Prevention Fund.

Despite losing about 1pp of its market share, CESKA pojistovna still controls about one quarter of the Czech insurance market (24.06%), while KOOPERATIVA pojistovna ranks second with an almost unchanged weight in the overall market turnover (23.2%). ALLIANZ pojistovna, after recording a 12% y-o-y increase in GWP, gained one extra percentage point in market share, currently accounting for 11.47% of the market GWP.

Access www.xprimm.com and download the 3Q2014 Czech Republic insurance market statistics.

Market portfolio (in EUR and CZK) according to the Czech National Bank (CNB):
  • Gross written premiums
  • Growth rates
  • Paid claims
Market rankings in EUR and CZK (GWP/Market shares/Growth rates) according to the Czech Insurance Association (CAP):
  • Overall market ranking
  • Life insurance ranking
  • Non-life insurance ranking
  • MTPL insurance ranking
  • Motor hull insurance ranking

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