Slovak insurance market saw a slightly positive trend in Q1, with GWP increasing overall by 1.42%, to EUR 577.6 million, an increase fully driven by the non-life insurance segment. The total volume of paid claims didn't change much y-o-y, increasing by less than 1%.
The Slovak Parliament adopted on 20 June the new legislation replacing the current 8% insurance levy with a new tax of the same amount applied to non-life insurance premiums, except for MTPL for which the current levy will be maintained.
The introduction of the new 8% tax on non-life insurance premiums in Slovakia was postponed from October 2018, to January 2019, to allow insurance companies prepare for the change, the country's parliament decided on 7 June.
The parliament has passed a bill on the introduction of a new 8% insurance tax in first reading. The new tax will be applied to all products of non-life insurance, with the exception of mandatory contractual insurance.
Club 500 does not agree with another increase in tax deduction in Slovakia. The introduction of a new insurance tax, approved on Wednesday at the first reading of the Slovak National Council, punishes contractors, but also individuals who act responsibly and assure their property.
Last year, the growth rate of the local insurance market (+8.56%) was almost double that of the advance of the economy (+4.69%), thus the calculated indicators as the insurance penetration degree (2.51%) and the insurance density (EUR 393 per capita) significantly evolved as compared to FY2016.
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.
In 1Q2017 the Slovak insurance market totaled EUR 569.5 million, 4.6% up y-o-y, the statistics published by the National Bank of Slovakia (NBS) indicated.
The Slovak insurance market was down by 1.78% y-o-y in 2016 in terms of GWP - to EUR 1.98 billion, according to data published by the Central Bank.
According to the Slovak Insurance Association data, the Slovak insurers ended 2016 with GWP of EUR 1,987 million, a result which is more or less in line with the previous year's premium production.
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.