The vast majority of Ukrainian insurers in the first month of martial law were able to organize and adjust their work in accordance with the prevailing conditions and continue their activities, the National Bank of Ukraine (NBU) said in a comment to the request of the Interfax-Ukraine news agency.
“The National Bank, as a regulator of non-banking financial services markets, in the first days of the war, developed and sent to all insurers a questionnaire in which market participants provide general information about their activities during martial law. This allows the NBU to understand the situation and take timely measures to maintain the insurance market,” the controller notes.
At the same time, it is specified that there are companies that cannot yet work, given their location, in particular, several insurers in Mariupol and Kharkiv reported that they were temporarily unable to carry out their activities.
As for the registration of insurers in the territory of hostilities, according to information from the State Register of Financial Institutions, 112 insurers are registered in Kiev, more than 100 separate divisions of insurers are registered in Kyiv and the Kiev region, including one division each in Vasilkov, Bucha and Brovary.
There are 5 insurers and more than 40 separate subdivisions of insurers registered in the city of Kharkov, one in Dergachi, Kharkiv region, one insurer and 19 separate subdivisions of insurers are registered in Chernihiv, two insurers and 12 separate subdivisions of insurers are registered in Mariupol, and 18 separate subdivisions of insurers are registered in occupied Kherson. subdivisions of insurers, three – in Nova Kakhovka, Kherson region, in Nikolaev – 20 separate subdivisions of insurers, in Sumy – 16.
Answering the question whether there are preliminary calculations of how much the insurance market could shrink both in terms of quantity and business, the NBU noted that, given the conditions of martial law, a number of measures were taken to ensure the functioning of the financial system of Ukraine. In particular, the NBU extended reporting and decided not to apply measures of influence to non-banking financial services market participants, including insurers, for violation of reporting deadlines, including for 2021. The deadlines (until April 1, 2002) for the submission by insurers of information and documents at the request of the National Bank, sent within the framework of on-site supervision, were also postponed. In addition, the activities of participants in the non-banking financial services market under martial law have been regulated.
“Given the extension of the deadlines for reporting by insurers until April 1, 2022, calculations and conclusions on the reduction of the insurance market can only be made after receiving reports and their analysis for 2021 and the first quarter of 2022. We will definitely publish this information on our website,” noted the regulator.
The regulator also clarified that in order to resolve the issue of obtaining insurance companies the opportunity to purchase short loans secured by government bonds in order to obtain instant liquidity, he turned to the National Commission for Securities and Stock Market (NCSM).
The NSMSC, guided by paragraph 13 of Article 8 of the law “On State Regulation of Capital Markets and Organized Commodity Markets” and in connection with the introduction of martial law in Ukraine, amended Annex No. 2 to its decision No. 144 of March 08, 2022 “On drawing up transactions in the capital markets for the period of martial law” new paragraph: “10. Depository institutions have the right to conduct depository operations in the depository accounting system related to the pledge of government securities in banks, the change and termination of such pledge, as well as the foreclosure of the subject of pledge” .
Answering the question whether the regulator, in connection with the current situation, does not intend to recommend banks to amend the existing deposit agreements of insurers, giving the right to unblock part of the funds necessary, in particular for payments, the NBU noted that the insurance companies that had such a problem are solving it with the National Bank on an individual basis.
Adonis Medical Group works with all insurance companies under voluntary medical insurance programs, the share of insurance patients in the group structure is up to 50%, it was noted during a presentation for insurance companies of the opening of a new branch – a full-cycle medical center in Sofiyivska Borschahivka.
“Adonis is a priority partner for insurance companies and a reliable medical base for insured patients, offering full-cycle services, including specialist appointments, hospital, surgery, dentistry, its own laboratory for testing, pregnancy and childbirth monitoring, and emergency medical care. The company has an international department to attract patients from all over the world,” the medical group said in a statement.
It is also reported that the presentation was attended by representatives of insurance companies Providna, Kniazha Vienna Insurance Group, INGO, ASKA, Kraina, UNIQA, European Insurance Alliance, Inter-Express as well as TBT-Insurance Broker.
As reported, Adonis Medical Group launched its own ambulance service in 2021.
Adonis is a network of private full-cycle medical centers for adults and children.
The private clinic Adonis was established over 20 years ago. Its network includes ten branches in Kyiv and the region, including two of its own maternity hospitals and a stem cell laboratory. In the branches of the clinic, doctors conduct appointments in 60 medical directions.
Some 13 participants of the nonbank market were removed in August of this year from the registers: two financial companies, seven insurers (one insurance company left the market voluntarily, six – forcibly), one pawnshop, two credit unions and one leasing company, according to the website of the regulator.
Some 153 non-life insurers (there were 160) and 17 life insurers, 286 pawnshops (there were 287), 301 credit unions (there were 303), 138 leasing companies (there were 137), 977 financial companies (was 973) and 61 insurance brokers are operating on the nonbank market now.
The NBU said that in general, in August, the number of participants in the nonbank financial market decreased from 1,938 (as of July 31) to 1,933 (as of August 31). The number of banks decreased from 73 to 72, since in August OJSC Settlement Center ceased its banking activities.
The regulator also said that in August, the NBU registered eight new players in the nonbank financial market: six financial companies and two leasing companies.
Some 37 payment systems created by residents and 14 international payment systems created by nonresidents operate on the payment market. In August, the registration of the Khazri international payment system, created by nonresidents, was canceled.
The National Bank received 604 requests from market participants for registration and licensing actions in August. The largest number of inquiries related to financial companies, pawnshops and lessors – 490. The number of inquiries from credit institutions (banks and credit unions) was 32, insurers – 82.
During the reporting period, the National Bank continued to apply enforcement measures to participants in the nonbank financial market. In particular, the regulator, on its own initiative, canceled all licenses for 45 institutions: 28 financial companies, one insurance company, 13 pawnshops and three leasing companies. Also in August, the NBU temporarily suspended the licenses of six insurance companies for violations committed by them.
The National Bank of Ukraine in July 2021 excluded four insurance companies from the state register of financial organizations, reducing their total number to 177, according to the central bank’s website.
Currently, 160 non-life insurers (there were 162) and 17 life insurance companies (there were 19) and 61 insurance brokers operate in Ukraine.
As reported, the committee on supervision and regulation of the non-bank financial services markets of the National Bank of Ukraine at a meeting on July 23 excluded PrJSC D-LIFE (Poltava) from the state register of financial organizations and on July 9 excluded PrJSC Alliance-Garant insurance company (Vyshgorod, Kyiv region), PrJSC Tekom-Life (Odesa) and PrJSC Capital-Insurance (Brovary, Kyiv region).
The decision was made according to the companies’ requests.
The assets of insurance companies in January-March 2021 decreased by 1%, to UAH 64.24 billion, according to a review of the non-banking financial sector, published on the website of the National Bank of Ukraine (NBU) on Friday.
According to the review, in January-March 2021, the number of registered insurers decreased to 208, which is 7.5% less than at the end of the first quarter of 2020 and 1% less than at the end of 2020.
The number of signed loan agreements with insurance companies in the first three months of 2021 amounted to 29.25 million, which is 27.8% less than in the first quarter of last year (40.53 million).
The NBU said that gross insurance premiums decreased slightly, mainly due to a seasonal decrease in revenues from insurance in the corporate sector and from life insurance.
At the same time, the volume of premiums in the risk and life insurance segments increased 6% year-over-year.
According to the report, risk insurers showed close to zero profits and margins, which is due to an excessive share of operating expenses – about 70% of net insurance premiums.
The loss ratios that were reduced to the annual target in the first quarter remained almost unchanged and amount to 47% for compulsory and 41% for voluntary types of insurance, the NBU said.
As of April 1, 2021, 44 licensee insurers did not meet the solvency and capital adequacy requirements or the riskiness of assets.
Ukrainian insurance companies in 2020 collected UAH 215.3 million of premiums under insurance contracts concluded through resident brokers, which is 24.3% more compared to 2019 (UAH 169.1 million).
According to the website of the National Bank of Ukraine (NBU), during this period 10,747 contracts were concluded through resident brokers, while in the same period a year earlier, according to the former regulator of the National Commission for Financial Service Markets Regulation it was 24,724.
The amount of remuneration for the provision of such intermediary services for the specified period decreased 28.8%, to UAH 20.02 million.
Reinsurance payments received by resident insurers under 166 contracts amounted to UAH 30.747 million, while a year earlier under 128 contracts it was UAH 12.660 million.
According to the NBU, nonresident reinsurers through brokers received UAH 1.085 billion for reinsurance under 244 contracts, while in the previous year it was UAH 920.7 million under 258 contracts.
Insurance payments compensated by nonresident reinsurers for the reporting period amounted to UAH 422.519 million, which is 2.9 times more.
The NBU does not provide indicators of remuneration for brokers for the reporting period; at the end of 2019, they amounted to UAH 34.619 million.