Signs again indicate growth in Central and Eastern Europe
The insurance markets in CEE stabilised further in conjunction with positive economic developments in 2016. Even the insurance markets in the Ukraine and Russia, affected as they were by negative economic and political events, were able to recover and attain double-digit premium growth (in local currency).
Supported by positive economic conditions and rising premiums in own markets, the non-life insurance business in CEE (excluding Russia), according to currently available results, was able to record the strongest growth since the beginning of the financial crisis: an increase in premiums of 6.0 to 7.0 per cent in 2016. All of the markets in Central and Eastern Europe reported a significant rise in premiums in the property insurance business. Growth stimulus here came mainly from the vehicle insurance line, in which higher vehicle inventories and rising average premiums for vehicle liability insurance in some markets led to high growth in premiums.
Developments in the life insurance markets, however, were fair to middling. As in previous years, countries with underdeveloped life insurance businesses were able to achieve high premium growth. Both the demographic developments and the shortcomings of state pension systems in these markets suggest rising demand for supplementary private insurance products. However, in the larger CEE markets – especially Poland and Czech Republic – the negative trend in life insurance continued also in 2016. A decisive factor here was a marked decrease in business with short-term single premium products, which also was the case in recent years.
The aggregated data on premium developments in CEE on a euro basis were also influenced in 2016 by negative currency exchange developments in major markets (above all Poland, Russia and the Ukraine).