Globally, insurers have 9-12% participation in the commercial real estate (CRE) market through direct and indirect investments in mortgages, bonds and directly owned real estate, according to a Gallagher report on its website.
Insurance companies are major investors in commercial real estate, with U.S. and European insurers investing approximately 12% and 7% of their investment portfolios in the sector, respectively. A potential recession, especially one caused by commercial real estate, has caused some concern in both the life and life insurance industries.
Also among the key findings of the report is that COVID-19 and the rise of the work-at-home workforce has led to a dramatic increase in downtown commercial real estate availability, among other things. This trend shows no signs of reversing.
Recessionary headwinds remain low with healthy US and EU economies stagnating but not contracting. China remains strong in absolute terms despite lower growth than in the recent past.
Banks have steadily increased their investments and expanded credit lines for commercial real estate. This has helped explain how the sector has remained resilient in difficult times.
The number of insurance companies in Ukraine in May 2024 decreased by one company and as of the end of the month there are 83 risk insurers in the market, 12 specialize in life insurance, one – with a special status (“Export Credit Agency”), according to the website of the National Bank of Ukraine (NBU).
In general, the number of participants in the country’s non-banking financial market in May decreased from 1,045 (as of April 30, 2024) to 1,014 (as of May 31, 2024).
The number of banks remained unchanged – 63.
According to the NBU, 26 financial companies, one risk insurer and two pawnshops were forcibly removed from the register. At the same time, one collection company and two credit unions were excluded on the applicant’s initiative. At the same time, one collection company was included in the register.
During May, eight financial companies, one insurer and one pawnshop had all their licenses revoked forcibly, while another 18 financial companies, one pawnshop and two credit unions had their licenses revoked voluntarily.
As of May 31, 2024, 555 financial companies (581 in April), 83 non-life insurers (84), 12 life insurers (the number has not changed), one insurer with special status, 119 pawnshops (121), 125 credit unions (127), five lessors, 40 insurance brokers and 74 collection companies (the number has not changed) were operating in the market of non-banking financial services.
In January 2024, insurance companies-members of the Motor (Transport) Insurance Bureau of Ukraine (MTIBU) concluded 556,241 thousand contracts of compulsory insurance of civil liability of owners of land vehicles (CTP), which is 1.37% less than in the same period in 2023.
According to the data published on the MTIBU website, 411 thousand contracts were concluded in electronic form, which is 14.31% more than in January last year.
In January 2024, the Bureau’s members increased the collection of insurance premiums under MTPL policies by 19.25% compared to the same period in 2023 – up to UAH 706.7 million, including UAH 560 million (+34.05%) under electronic contracts.
The total amount of accrued insurance claims under domestic insurance contracts increased by 40.7% to UAH 400.7 million, including UAH 81.951 million paid using the Europrotocol (+23.02%).
The Bureau also recorded an increase in the number of settled insurance claims by 22.2% to 12,498 thousand, including 4,550 thousand (+5.25%) using the Europrotocol.
MTIBU is the only association of insurers in Ukraine that provides compulsory insurance of civil liability of owners of land vehicles for damage caused to third parties. The Bureau’s members include 35 insurance companies.
The leaders of the Ukrainian insurance market in terms of collected net insurance premiums in January-September 2023 were: ARKS Insurance Company (UAH 2.378 billion), TAS Insurance Group (UAH 2.601 billion) and Unica Insurance Company (UAH 1.984 billion) (all based in Kyiv).
No. Name of IC Net premiums Growth rate Written premiums Growth rate Assets Reserves
1 ARX 2378 +6.8% 2760 +21.5% 5455 2838
2 TAS 2601 +54.7% 2542 +47.7% 3696 2486
3 UNIQ 1984 +9.4% 2381 +23.8% 4557 2114
4 VUSO 1693 +86.2% 2005 +78% 1726 1087
5 USG 1632 +17.2% 2243 -1.2% 3767 2312
6 INGO 1466 +34.6% 1993 +64.9% 3527 1889
7 Arsenal Insurance 1323 +5.3% 1599 +42.3 2383 1602
8 Universalna 1212 +48.3% 1463 +54.7% 2062 1121
9 PZU Ukraine 1109 +33.1% 1314 +42% 2065 1394
10 Oranta 927.8 +16.2% 1100 +29.6 1535 980.3
11 Guardian 844.5 +57.2% 1010 +60.5% 996.3 699.3
12 Knyazha VIG 825.5 +40.7% 1464 +68.9% 1758 1382
13 Premier Garant Profi 620.4 +26.9 617.5 +25.6% 180.2 19.7
14 Persha 487.4 +59.3% 599.4 +47.7% 926.9 639.9
15 Express Insurance 468.5 +12.5% 511.1 +68.5% 715 360.1
16 Colonnade Ukraine 355.1 +39% 450.2 65.4% 863 337.7
17 Euroins Ukraine 321.3 +9.3% 408 +22.1 1059 647.5
18 Alfa Garant 298.3 +24.2% 330.9 +37.6% 348.3 294
19 Oberig 293 +47.8% 275.1 +30.7% 278.3 186.8
20 UPSC 282.4 -63.9% 359.7 +0.2% 690.1 267
Ukrainian insurance companies’ expenditures on advertising and marketing in January-June 2023 increased by 27.7% compared to the same period of 2022 – up to UAH 64.5 million, the National Bank of Ukraine (NBU) said on its website.
According to the report, insurers’ administrative expenses for the period amounted to UAH 2.656 billion, which is 2.5% more than in the first half of 2022, while their sales expenses increased by 6.3% to UAH 1.032 billion.
In addition, expenses on conclusion and prolongation of insurance contracts increased by 5.3% – up to UAH 5.317 billion, including expenses on agency fees – by 4.4%, up to UAH 4.899 billion.
Expenses on conclusion and prolongation of reinsurance contracts have increased 2,1 times – up to UAH 56,7 mln, including expenses on brokers’ remunerations – 2,2 times, up to UAH 56,1 mln, of which non-resident brokers – decreased by 12,5%, up to UAH 11,2 mln.
Expenses for insurance claims settlement increased by 40.9% to UAH 221.3mn, while expenses for appraisers’ services increased by 75.3% to UAH 77.5mn.
Expenses for assistance payment increased by 12.7% and amounted to UAH 91.7mn. At the same time payment for services of non-resident assistant has decreased almost twice – to UAH 4,2 mln.
Insurers’ expenses for court cases have increased in 3,1 times – up to UAH 33,1 mln.
As reported, insurance companies of Ukraine in January-June 2023 collected net premiums in the amount of UAH 20.895 billion, which is 21.7% more than in the same period of 2022, paid UAH 7.744 billion of net insurance payments (+31%). The level of net payouts increased from 34.4% to 37.1%.
According to the NBU, as of June 30, 2023, the total number of insurance companies in Ukraine amounted to 115, of which 12 specialized in life insurance, while on the same date a year earlier there were 142 (13).
National Bank of Ukraine (NBU) has applied the enforcement measures to IC “Greenwood Life Insurance” and IC “Alfa Insurance” (both Kiev) in the form of an obligation to take measures to remedy violations until July 17, 2023, according to the website of the regulator.
“Measures of influence are applied due to non-compliance with the requirements of paragraphs 1 and 11 of the NBU board resolution “On peculiarities of application of registration and licensing procedures of non-bank financial services market participants during martial law …”, – said in a message on the regulator’s website.
According to the document, it refers to written assurances of companies to the National Bank about the compliance of direct and ultimate owners of material participation to the requirements of the regulator on the financial / property status, documents to assess such a position and subsequent responses to the NBU request.
PrJSC “Greenwood Life Insurance” works in the Ukrainian life insurance market since 2007 as the successor of the insurance company “Guarantee Life”. The company is a part of financial and investment holding Green Globe Enterprises INC (USA, New York), which operates in the territory of Europe, Asia, America.
IC “Alfa Insurance” was founded in 2000. On December 5, 2022 NBU has applied to IC “Alfa Insurance” a measure of influence in the form of temporary suspension of the license to provide financial services. Due to the company’s non-compliance with the requirements of the Regulations on licensing and registration of financial service providers and the conditions of their activities in the provision of financial services…, namely, the requirements for business reputation of financial service providers.
ALFA INSURANCE, Greenwood Life Insurance, INSURERS, NATIONAL BANK
