KYIV. April 14 (Interfax-Ukraine) – The situation on the outward reinsurance market in Ukraine has improved over the past 10 years, with the market becoming more conventional and in 2014 the geographic structure of the reinsurance portfolio was balanced thanks to the reduction of Russia’s share of the market from 40% to 18% with almost no administrative measures being taken, member of the national commission for financial service markets regulation Oleksandr Zaletov said at a first meeting of the investment committee organized by Insurance TOР magazine.
He said that the history of Ukrainian insurance went hand in hand with the reinsurance market in Russia.
Zaletov said that there are three categories of reinsurers who reinsured Ukrainian risks in Russia: subsidiary Russian representatives of global insurers (SCOR, Munich Re), traditional Russian reinsurers (Ingosstrakh, Unity Re, etc), and insurers representing the Russian political elite.
Ukrainian insurers have had time to think and redistribute their flows of outward reinsurance and define new strategic partners, Zaletov said.
“Now the outward reinsurance portfolio is more diversified than it was earlier. The regulator believes that it could revoke rating grants to reinsurance and pegging to the country rating. Today we should return to the international reinsurers rating scale,” he said, adding that the requirements to cover reserves by reinsurers should be toughened to 25%.
According to information presented by the commission at the meeting, 22.9% of Ukrainian risk is reinsured in UK, 21.4% – in Germany, 13.7% in Switzerland, 6.4% in Austria, 3.6% in France, 2% in the United States, 1.7% in the Czech Republic, 1.5% in Poland, 1.1% in Ireland and 1% in Italy.
Zaletov said that the regulator knows reinsurers on the Ukrainian market who receive from UAH 500 million to UAH 1 billion of reinsurance payments and pay nothing on the risks,.
“The regulator plans to toughen checks of these “rural club insurers” registered in the burned down House of Trade Unions in Kyiv. The regulator has several problems with the organization of the checks, as there are no formal signs to initiate the checks under Ukrainian law,” he added.
