Vienna Insurance Group (VIG) intends to enter the top three leaders of the Ukrainian insurance market, and is mulling the possibility of acquiring another risk insurance company. “We came here to stay. Our goal is to be a leader in the insurance market, to enter the top three,” member of the board of Vienna Insurance Group Franz Fuchs said at the first joint press conference of Ukrainian insurance companies that are part of VIG.
At the same time, he noted to date, according to the group, VIG ranks fourth in the insurance market of Ukraine.
He also noted that VIG adheres to a conservative mode of management, has enough funds for investment and Ukraine could become one of the countries in which the money will be invested.
He stated the insurance market of Ukraine is very complicated, with confusing legislation and unsettled communications.
“More than 100 insurance companies work in the market, but if you look at how they really work, then this figure will be reduced to 23-27. There are 45 million people in Ukraine, and if everyone pays EUR9-10 for insurance, then we have something to work on,” he stressed.
According to the expert, many investors leave the Ukrainian market, because they do not see short-term advantages. VIG has the plan of development for three, five and seven years, because there are millions of uninsured cars and houses in Ukraine.
Consumer sentiment in Ukraine has improved after falling at the beginning of the year: the consumer confidence index after a decrease of 3 points in the first quarter grew by 4 points in the second quarter, to 62 (on a scale of 0 to 200), according to a study by The Conference Board, prepared jointly with Nielsen. “The growing trend encourages, while consumers remain very cautious due to the unstable economic situation in the country,” Nielsen’s press release quotes Nielsen Managing Director for Ukraine and Belarus Vaios Dimoragas as saying.
He noted that the record low level of consumer confidence in Ukraine was recorded in 2015 at 41 points.
The company states the improvement of the index is due to the improvement by consumers of estimates of prospects in the labor market and their financial well-being. At the same time, the indicator of readiness to spend money is relatively stable for the fourth consecutive quarter.
The study says the absolute majority of Ukrainians continue to believe that the country is in a state of crisis, while the number of such declined to 92% in the second quarter of 2018 compared to 95% in the first quarter. The number of those consumers who believe that the country will not get out of the crisis in the next 12 months is stable.
The list of worries is headed by the war – 31% of Ukrainians are concerned about it. The growth of housing and utilities services tariffs ranks second – 29% of consumers are concerned about it. They are followed by such reasons for concern as the economy and rising prices for food and health.
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Ukrainian Insurance Group and Globus Insurance Company (both based in Kyiv), that are members of Vienna Insurance Group, plan to complete the merger and become a single legal entity at the end of 2021, Head of Ukrainian Insurance Group Pavlo Nelha has said at a press conference.
“In fact, the process of merger, taking into account the peculiarities of Ukrainian legislation, is not fast, not easy, and we are ready for it. Our plan is to have one legal entity and unite the balance sheets of the insurance companies by the end of 2021,” he said.
He said that one of the reasons for such a long period of consolidation is different organizational forms of the companies as Ukrainian Insurance Group is a joint-stock company, while Globus is an additional liability company.
“To date, the stage of combining the networks and offices has already been completed. We approached the second stage – a legal merger of the two companies, in fact, the merger of the balance sheets,” Nelha noted.
Ukrainian Insurance Group has been operating in the market for over 18 years. It has 30 licenses for voluntary and compulsory types of insurance. The regional network has more than 80 offices throughout Ukraine. The company employs more than 500 people.
Globus insurer has been operating in the market for more than 24 years. It HAS 19 licenses for different types of insurance.
The Nova Poshta Group (Kyiv), operating in the express delivery segment, opened 49 new depots in August 2018.
According to a company press release, the total number of depots across the country grew to 2,440.
“In August, 49 depots were opened: 13 mini departments accepting parcels weighing up to 15 kg, 23 depots for sending parcels weighing up to 30 kg, and 13 depots unlimited by weight,” the company said.
New branches appeared in Kyiv, Ivano-Frankivsk, Ternopil, Kharkiv and other large cities, as well as in smaller towns – in Nadvirna, Bakhmut, Enerhodar, Ichnia, Baturin and others.
In addition, the company has changed the locations of 18 already operating branches to more convenient ones in different cities of Ukraine in order to reduce the load on the branches.
Nova Poshta also continued its partnership with retail supermarket networks.
The Auchan Ukraine network has four pick-up and drop-off points in Kyiv and it is planned to expand into all 23 stores.
Nova Poshta opens new depots in the Leroy Merlin network in Kyiv; the Lotok network has more than 10 pick-up and drop-off points around the city.
According to the company’s report, in January-July 2018, Nova Poshta customers in the e-commerce market sent 19.2 million items, which is almost 27% more than in the same period of 2017.
