On September 7, the National Bank of Ukraine (NBU) revoked the licenses of Gestalt Group Insurance Company and INTO Insurance Company (both based in Kyiv) to conduct financial services business.
According to the regulator’s website, the decision was made with respect to Gestalt Group due to the fact that the insurer’s ownership structure does not meet the requirements of Ukrainian legislation, and with respect to INTO for failure to comply with the National Bank’s decisions to eliminate violations of license conditions.
According to the latest financial statements submitted by Gestalt Group Insurance Company, as of June 30, 2023, the company’s insurance premiums amounted to UAH 5,971 million, assets amounted to UAH 81,642 million, and insurance reserves amounted to UAH 1,952 million. The company’s market share in terms of insurance premiums amounted to 0.03%.
According to the latest reports submitted by INTO Insurance Company, the volume of insurance premiums amounted to UAH 28.767 million, the value of assets – UAH 139.178 million, insurance reserves – UAH 18.028 million. The company’s market share in terms of insurance premiums amounted to -0.2%.
The NBU emphasizes that the decisions come into force on September 8. In the event of license revocation, a financial services representative must fulfill its obligations under contracts with clients for the type of financial services specified in the decision, concluded before the date of entry into force of the decision to revoke the license.
The National Bank of Ukraine (NBU) has revoked the licenses of ALC IC Amji-Insurance (Kiev) and PJSC IC VONA to provide financial services due to the non-compliance of their ownership structure with the legislation. (Lviv), reported on the website of the regulator.
The decision to cancel the licenses was taken by the board of the NBU on March 2, 2023 in accordance with Article 381 of the law “On Financial Services and State Regulation of Financial Services Markets”.
The NBU informs that according to the last submitted financial statements for the year 2022 the amount of insurance premiums of the company as of December 31, 2022 was UAH 1.927 million, the value of assets – UAH 39.322 thousand, insurance reserves – UAH 270 thousand. The market share of the company on insurance premiums amounted to 0,006%.
According to the last submitted statements of IC “VONA” for 2022, the value of its assets amounted to UAH 31,098 mln. There were no insurance premiums, insurance reserves. The market share of the company on insurance premiums – 0,0%.
After the revocation of license the financial institution is deprived of the right to operate by the types of licenses withdrawn, but does not relieve the financial institution from its obligations under contracts for the provision of financial services.
IC “Amji Insurance” (until March 2019 – OTO “OTL-Insurance”) specializes in risk insurance. According to the data of the company, published on its website, as of the beginning of 2022 its shareholders were 16 individuals.
IC “VONA” (former IC Veltva) has been incorporated in October, 1995. Since 1997 it is a member of the Motor (transport) Insurance Bureau of Ukraine, the Kharkov Union of Insurers, “Insurance business” association and the Kharkov Chamber of Commerce and Industry.
In October 2013 IC “VELTA” has rebranded to PrJSC “Insurance company “WONA” and changed its location to Lvov.
According to the website of the insurer, its shareholder on January 1, 2022 is LLC “UKR SEL” (Lviv), which owns 99.9% of the insurer. Through it, Tatiana Barbaniuk owns 13,9986% of the insurer, Yaroslav Ishchak – 41,276%, Roman Kapustin – 44,816%.
On September 29, 2022, the National Bank of Ukraine applied to PJSC Ukrainian Industrial Insurance Company and ALC Nadiya Insurance Company (both Kyiv) measures in the form of license cancellation, according to the website of the regulator.
The reason for this decision was the repeated violation of license conditions and once again failure to provide information at the request of the regulator. Namely, observance of mandatory monetary standards, overdue obligations under concluded insurance contracts, cases of violation of the deadlines for the settlement of declared events that have signs of insurance (the composition of the reserve for claimed but not paid losses).
“Consequently, for a long time after the start of the Russian aggression, insurers did not take measures to establish operational activities and accounting. This makes it impossible to carry out full-fledged insurance activities,” the report says.
Decisions to cancel licenses come into force on September 30, 2022.
As reported on August 12, 2022, a measure of influence was applied to these insurers in the form of a temporary suspension of licenses.
Insurers, to which the National Bank has applied enforcement measures, operate in the non-life segment.
PJSC “Ukrainian Industrial Insurance Company” does not provide reports to the National Bank, starting from the reporting for 2021.
ALC IC “Nadiya” does not provide reporting, starting with the reporting for the 1st quarter of 2022.
Based on the results of 2021, IC Nadiya received UAH 3 million in insurance premiums and made UAH 3.1 million in insurance payments. At the same time, the company did not enter into insurance contracts with individuals. The company’s market share based on the results of 2021 is 0.006%. The insurer informed the National Bank of the temporary cessation of insurance activities after the start of the military aggression of the Russian Federation.
Insurance companies of Ukraine in 2021 collected net premiums in the amount of UAH 45.987 billion, which is 14% more than in 2020 (UAH 40.350 billion), the National Bank of Ukraine reported on its website.
According to the regulator, the volume of gross insurance premiums collected by insurers last year amounted to UAH 49.708 billion, which is 10% more than a year earlier (UAH 45.185 billion). Of these, receipts from individuals amounted to UAH 27.912 billion, from reinsurers – UAH 1.890 billion (in 2020 – UAH 4.201 billion).
In addition, according to the regulator, in 2021, Ukrainian insurers paid UAH 17.671 billion of net insurance payments (+22.3% by 2020). The level of net payments increased to 38.4% from 35.8%.
According to the NBU, gross insurance payments increased by 20.9% to UAH 17.958 billion. The level of gross payments increased to 36.1% from 31.9%
According to the regulator, the volume of insurance payments owned by reinsurers in 2021 amounted to UAH 8.623 billion (+1.6%), of which non-resident reinsurers – UAH 4.9023.652 billion (+34.3%).
The regulator also reports that last year the volume of formed insurance reserves increased by 7.2% – up to UAH 36.566 billion. At the same time, with a decrease in the total assets of insurers by 1.1%, to UAH 64.209 billion, the volume of assets determined by law to represent insurance reserves increased by 2.3% compared to 2020, to UAH 47.159 billion. The volume of paid authorized capital decreased by 18.7% – to UAH 7.924 billion.
The regulator also reports that in 2021, 131.562 million contracts were concluded, while a year earlier, 120.586 million insurance contracts were concluded.
According to the NBU, the total number of insurance companies in Ukraine as of December 31, 2021 was 155, while on the same date a year earlier it was 208.
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.
