A solvent, sustainable, competitive insurance market in Ukraine with adequate protection of the rights of insurance consumers.
This idea, reflected in the White Paper “The Future of Insurance Market Regulation”, became the principles around which insurers with different business models, premiums and shareholder countries united in 2020. The current association NAIU united companies that were members of the National Association of Insurers of Ukraine, the League of Insurance Organisations of Ukraine and the Ukrainian Insurance Federation, and those who were not members of the associations also joined.
It is the recognition and implementation of the principles that has been and continues to be a condition of cooperation for the NAIU.
It was decided to achieve the common goal by combining their experience and best practices, professing common beliefs in the formation of transparent rules of the game, and engaging professionals to provide expertise and formulate common positions.
This is not a cohort of like-minded people, but those who share a common goal – to develop and support a solvent, financially sound, competitive and stable insurance market that will ensure proper consumer protection and provide insurance services and products that meet the needs of citizens and the economy.
Currently, the NAIU consists of 28 insurers, each of which embodies these principles in their daily work. This is the association’s office, which is a team of experts that develops ideas and ways to implement them. And it is also the CEO Denis Yastreb, who is a moderator and ambassador of the principles and objectives of the united NAIU.
Throughout their work together, the NAIU insurers have been supporting the Regulator’s ideas, providing them with expert and practical elaboration, which together allows them to maintain a balance of interests and ensure future practical application. The Association has operational and objective market performance indicators, which are also used to achieve the effectiveness of the NBU’s regulation. We are confident that such a working professional synergy is a prerequisite and key to achieving the goals of the Regulator and insurers, and both parties need it.
Steps taken by the NBU to create an improved insurance market – the new Laws of Ukraine “On Insurance”, “On Compulsory Insurance of Civil Liability of Owners of Motor Vehicles”, requirements for solvency and reporting, corporate culture and transparency are steps that insurers are also taking together. Despite the novelty, the need for reflection, study, process adjustment and updated approaches, everyone understands and unquestioningly shares the need for change.
We did not stop our joint journey during the war. The NAIU insurers have survived, endured and are moving on. This is the result of our activities all the time before the full-scale war, as well as tireless work during it. From the first day, the NBU team did not stop communicating with insurers, and therefore the question “How are you?”, which supports each of us every day, was also relevant at the level of setting up business processes during the war. Information requests, chats, zooms, planning, and clarifications did not always take place from offices, but they were always effective for all those present. This interaction is also part of the market’s performance in 2022.
The NBU’s forced and unpopular steps are also difficult for insurers to implement, but the NBU’s activities to regulate the insurance market in Ukraine are in line with its stated goal, and therefore are shared and supported by the National Association of Insurers of Ukraine.
In achieving a common goal, it is extremely important to have mutual understanding. After all, we are aware of the “monsters” that any misunderstanding can create in these times of change and uncertainty.
The meeting of the NBU Board and insurers held on Wednesday at the National Bank is a continuation of the dialogue that has been started, joint steps towards transparency and mutual understanding, for which the National Association of Insurers of Ukraine is grateful to the National Bank of Ukraine.
The NAIU interacts with the NBU in a working manner on each of the issues related to the activities of insurers. This is a daily routine cooperation for the common result. This made it possible to shift the focus of the meeting from current issues to highlighting our own position and aspects that we consider necessary for the sustainable functioning of insurers:
- Coordinated work of insurers and the NBU on the development, adoption and implementation of regulations related to the entry into force of the Law of Ukraine “On Insurance”.
- Encouraging insurance through tax incentives, in particular for employers.
- Building a constructive dialogue between the management and supervisory bodies of the MTIBU. Formation of the structure of the MTIBU’s management and operation, taking into account the new Law. Ensuring such functioning continuously, including after the implementation of the new Law.
- Search for a model to simplify financial monitoring activities for risk (non-life) insurance.
CEO of the NAIU Denis Yastreb noted that in times of war, tools for detecting and identifying terrorists and war criminals are an important part of the state’s activities. The NBU has created and continues to improve an effective mechanism for preventing the influence of russia, belarus, and states supporting the criminal war in Ukraine. The National Securities and Stock Market Commission plans to use a similar tool by introducing a requirement for issuers of securities to inform the Commission about their relations with risky countries. According to the NAIU, the National Bank of Ukraine has greater opportunities to effectively use this mechanism, concentrating full information in the Regulator will avoid duplication of functions of state bodies and save resources of market participants.
Denis Yastreb also noted the desire of insurers to study the NBU’s law enforcement practice. He noted that each decision of the Regulator is studied by insurers to understand the approaches to regulation, supervision, licensing, and consumer protection. For companies, this is a tool for self-assessing the compliance of their own activities, an element of risk management, regulation and process development. Thus, the NBU’s coverage of relevant impersonal practices on its website will be welcomed by insurers and used for self-improvement.
The interests of consumers are an important component of transparent and fair business, and we treat them with the utmost responsibility and unquestioningly comply with the legal requirements for consumers of insurance services. And recently, the NAIU has launched a financial literacy project. It is really important for us that our clients are not only protected but also financially literate.
The meeting demonstrated the level of professionalism and depth of the Regulator’s understanding of the state and prospects of insurers. This awareness encourages us to work even harder, as it gives us confidence in the inevitability of the announced and expected reforms.
The insurance market is currently undergoing a stage of adaptation and transformation. Preparations for work under the updated legislation, crises of individual market participants, constant search for a balance of business interests and compliance with regulatory requirements are taking place in a time of war. However, insurers have no right to be a burden for the state, but rather an effective element of sustainable operation and economic recovery. We have to be resilient, honest, proactive and relentless in our work and reforms.
“Our common goal is Victory. Therefore, we have no right to non-transparency and insolvency,” the CEO summed up the position of the NAIU.
