A new indirect taxation system for the insurance premium is in preparation in Slovakia, replacing the current special insurance 8% levy with a rate which will vary from 2 to 18% depending on the type of the policy, local press reads.
In the first three quarters of 2017, the Slovak insurance market totaled EUR 1.61 billion, representing an increase of 7.62% y-o-y, according to the quarterly financial figures published by the National Bank of Slovakia (NBS).
In 1H2017, the Slovak insurance market totaled EUR 1.06 billion (11.8% more y-o-y), while the value of paid claims was of EUR 575 million, according to the preliminary financial figures provided by the National Bank of Slovakia.
Rates may rise only marginally for some types of insurance, but others could increase by 15 percent or more, experts say. As
of the beginning of 2017, prices of some non-life insurance products,
mainly vehicle and travel insurance, have started to increase in
Slovakia. Insurance companies are responding in this way to a new
8-percent levy that the state now applies to every new premium.
The 8% levy on insurance premiums extension from the MTPL class to a;; the facultative non-life insurance lines in Slovakia started to produce effects on the insurance premiums, reports The Slovak Spectator, mentioning especially the vehicle and travel insurance premiums.
The Slovak Government and Parliament made several changes to the tax system with effect from 1 January 2017, some of them affecting also the local insurance companies, as well as their foreign shareholders. The recently adopted amendments concern - among others - corporate and personal income tax, value added tax, special levy in regulated industries, as well as social security and health insurance contributions, reads a Kinstellar report published by the Lexology portal.
Belgian banking and insurance group KBC is interested in looking for acquisition opportunities in Slovakia, in line with its plan to expand in its core markets in central Europe, KBC Group Chief Executive Johan Thijs said on Wednesday.
The Slovak government's decision to extend the 8% tax, previously applied only to the MTPL insurance premiums, to all the facultative non-life insurance lines has raised not only insurers' discontent, but also a negative reaction of CESMAD - the Association of Road Transport Operators of the Slovak Republic. In short, Slovak hauliers blame the recent change in taxation for the sharp increase in the mandatory motor insurance prices.
Slovak insurers have ended 1H2016 with an overall GWP volume inferior to the previous year's results for the same period. According to the market representatives, given the Slovak market's stability during the recent years, the end year market results should be more or less in line with the 2015 results.
Last year, the Slovak insurance market totaled EUR 2 billion, down by 4.1% y-o-y, as the preliminary statistics published by the National Bank of Slovakia (NBS) indicated. The life insurance field decreased by 9.6% y-o-y due to the 18% depreciation of unit-linked subsegment, while the non-life GWP was up by 2.8% to EUR 965 million.
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