Thanks to the MTSBU and NAIU, data from the motor vehicle became more accessible

In November 2023, a Memorandum of Partnership was concluded between the National Association of Insurers of Ukraine (NAIU) and the Motor (Transport) Insurance Bureau of Ukraine (MTSBU), one of the directions of cooperation, which defined the exchange of information on the performance indicators of insurers.

For the practical implementation of the declared agreements, starting from November, the parties to the Memorandum carried out fruitful cooperation on the definition of data categories, the format of information exchange, consolidation parameters and visualization of indicators of the activities of insurers providing compulsory civil liability insurance. Currently, the preparatory stage has been completed and we are happy to present the results of information exchange and analysis visualized by Power BI tools in free access on the NAIU website.

We offer new indicators that can be interesting and useful to both consumers and insurers from among the already familiar data from the auto-civil system, which are now conveniently and up-to-date visualized by means of Power BI.

Including:

the size of the average premium for “paper” and electronic compulsory insurance contracts;

average payment for property damage;

average payment for damage caused to life and health;

average payment according to the Europrotocol;

the number of settled claims;

ratings of insurers providing compulsory civil liability insurance.

In NAUI, the results of 2023 were summed up

NAUI participants gathered at the next annual meeting of the Association, where they summed up the results of 2023

The General Director and the Presidium reported, discussed the annual plan of activities of NAUI and the status of its implementation.

It can already be stated that many of the initiatives previously developed by NAUI were implemented in 2023, described in regulatory acts, and taken into account in concepts and programs. These are the necessary tax changes, especially in the field of life insurance, dozens of regulatory acts for the implementation of the new Law on Insurance, expected changes in the motor vehicle code, and partly in the field of financial monitoring. We expect and are working to make all projects a reality this year.

They noted the constant development and improvement of PDMA, which is also awaiting transformation this year in connection with the change in accounting and reporting. They mentioned the financial literacy project and updating the Association’s website, which are designed to make insurance more understandable for both clients and insurers.

There have been changes in the governing bodies of NAUI. Inna Belyanska, a representative of Metlife , headed the Life Insurance Committee of the Association and was elected to the Presidium of the NAUI.

They decided not to stop and, in spite of everything, to work and fulfill the duties and tasks facing the insurers and NAUI.

NAIU determined what and with what will be achieved in 2024

The General Meeting of the Association was held, which was supposed to resolve the issues of plans and tasks of  NAIU for the next year, as well as to elect the head of the association.

Planning for the next year, which will be the year of implementation of several revolutionary legislative changes, NASU members agreed on a plan for 2024.

The issues of the annual plan are directly related to the general principles and directions of activity of NAIU: digitization, improvement of taxation and simplification of finance in insurance, interaction with regulators, MTIBU and stakeholders, and development of the information exchange project between PDMA participants.

Particular attention will be paid to the implementation of the Law of Ukraine “On Insurance”, updating the Law of Ukraine On Compulsory Civil Liability Insurance of Land Vehicle Owners”, during which NAIU will provide methodological support and coordination of its participants.

By uniting insurers, NAIU will be headed by Yastreb Denys.

More about NAIU

Announcement of competitive selection for the position of general manager

“National Association of Insurers of Ukraine,” fulfilling the requirements of the statutory documents, announces a competition for the position of the association’s leader.

Documents and information for participation in the competition are accepted via email at [email protected] until November 22, 2023, inclusive.

Requirements for the candidate and a list of documents to be submitted are provided in the appendix to the announcement.

The competition winner will be considered by the General Assembly of the Association for approval to the position of General Director.

For more information on the competition conditions and the association leader’s responsibilities, you can inquire by sending an email to the competition address.

Requirements for Candidates:

To participate in the competitive selection, the applicant electronically submits to the address specified in the selection announcement the following documents:

  • Application to participate in the competitive selection (in any form).
  • Copy of the employment record book or documents confirming work experience.
  • Copy of the document on higher education.
  • Biographical information (resume), including the exact period of work; job titles; duties performed in the specified positions; the number of employees under supervision (in any form).
  • Motivational letter.
  • Competitive proposal.
  • Consent for the processing of personal data.

A person who has expressed a desire to participate in the selection may submit additional information confirming compliance with the requirements specified in the announcement, especially regarding work experience, professional competence, reputation (characteristics, recommendations, scientific publications, etc.).

The competitive proposal should include:

  • Analysis of the current situation and a detailed action plan for the association for one year, long-term – for three years.
  • Measures to implement the task plan and results of the analysis of possible risks.
  • General vision of the role, tasks, and place of the Association in the insurance market.
  • The position of the association leader in its functioning.

Requirements for Candidates:

  • Higher education, including (but not limited to) in one of the following fields of knowledge: “Social and Behavioral Sciences,” “Management and Administration,” “Public Management and Administration,” “Law,” “International Relations,” “Finance,” “Insurance.”
  • Total work experience of at least 10 years, with managerial experience (strategic or operational management) of at least five years.
  • In-depth knowledge in the field of insurance and finance, including legislative acts on these issues.
  • Impeccable business reputation.
  • Experience in cooperation with international and foreign organizations and at least five years of experience in insurance.
  • Leadership qualities, systemic thinking, a high sense of duty and responsibility, zero tolerance for corruption, determination, and proactivity, the ability to make clear and well-founded decisions, determine ways of their implementation.
  • Excellent communication and organizational skills, including the ability to seek and establish new productive forms of cross-industry cooperation to achieve common goals, the ability to build, support, and develop effective partnership relations with representatives of Regulators, the Verkhovna Rada of Ukraine, associations, media, public opinion leaders, the ability to publicly speak and effectively convey information, coordinate positions, and produce effective consensus decisions.
  • Ability to identify needs and the necessity of changes, ability to organize systematic changes, anticipate and consider all useful opportunities and negative consequences in the conditions of their implementation.

Duties as the Head of the Association:

  • Directing the activities of the Association to implement the provisions of the NBU White Paper, current management of the Association, interaction with association members.

Memorandum on partnership between NAIU & MTIBU was concluded

The Memorandum of Partnership was signed between the National Association of Insurers of Ukraine (NAIU) and the Motor (Transport) Insurance Bureau of Ukraine (MTIBU) 

The signing of the Memorandum is a continuation of the ongoing cooperation between the parties aimed at achieving the common goal of insurers – the functioning of reliable and effective compulsory civil liability insurance, which ensures the protection of consumer rights. 

Within the framework of the agreements reached under the Memorandum, the NAIU and MTIBU will exchange information on the performance of insurers, as well as take joint actions to improve the financial literacy of clients (consumers) of financial services in the segment of compulsory civil liability insurance. 

Implementing the direction of interaction on the exchange of information enshrined in the Memorandum, the NAIU will consolidate the information received from MTIBU on the performance indicators of insurers that carry out compulsory civil liability insurance, and post the results of the analysis visualized by Power BI in free access on the website. Such information will supplement the data of PRIMA information exchange, and will be able to be freely used by consumers and insurers. Obtaining this information from the Motor (Transport) Insurance Bureau of Ukraine will ensure high quality, and, therefore, reliability of information. Publication of the results of the participants’ activities is a common practice of both associations, so the consolidation of efforts in this direction will increase the availability and transparency of such information. 

It is expected that the direction of cooperation in financial literacy will be implemented in preparation for the implementation of the updated Law of Ukraine On Compulsory Insurance of Civil Liability of Owners of Land Vehicles. In view of the radical update of the regulation of this important type of insurance, the combination of expertise and experience of MTIBU and NAIU on financial literacy projects will ensure the dissemination of accessible and verified information, which will contribute to increasing financial literacy and consumer awareness. After all, the protection of clients’ rights from the best business practices becomes the task of insurers.

Interview with Denis Yastreb for Banker.ua

The recovery of Ukraine in the post-war period is one of the most critical issues that everyone is already addressing today. Everyone, from the State, President, parliamentarians, government officials, regulators, entrepreneurs, and our international friends and partners, plays a part. Our soldiers – both young men and women – give us confidence every day and bring us closer to victory over the enemy. Therefore, our main task is to secure the future of Ukraine.

The insurance industry is steadily maintaining its structure and meeting the needs of the population and businesses for insurance. Today, we can assert positive trends in the recovery of the insurance sector.

In the first half of 2023, the insurance market of Ukraine continues to actively recover. Premiums for risk insurance amounted to 19.1 billion UAH, which is 24.0% more than in the same period in 2022. However, this result is still 13.5% worse than in the first half of the “pre-war” 2021.

Analyzing the insurance market data, a significant increase in premiums and concluded insurance contracts for property insurance types is noticeable. For example, in property insurance, premiums from individuals increased by 154.8 million UAH compared to the first half of 2022. The likely reason for this is the desire of property owners, including apartments, houses, and other real estate, to protect themselves from risks, including war-related risks. Insurers’ offers for property insurance, including war-related risks, have also contributed to this trend, and it has been observed since the fall of 2022.

One of the insurance sectors demonstrating one of the largest growth rates is cargo insurance (+263.6 million UAH), which, in our opinion, reflects the recovery of business activity among private enterprises, logistics within Ukraine, and beyond its borders.

Traditional participants of the National Association of Insurers (NAI) are also recovering more actively. In the first half of 2023, the total collected premiums amounted to 13.8 billion UAH, which is 27.7% more than in the same period in 2022, and this figure already surpasses the pre-war 6 months of 2021.

Insurance payouts for risk types of insurance in the first half of 2023 amounted to 7.2 billion UAH, of which 5.5 billion UAH were paid by NAI members.

Insurance payouts increased by 28.1% compared to the first half of 2022, but the market has not yet reached pre-war levels.

Insurance reserves continue to grow and, as of June 30, 2023, amount to 24.3 billion UAH, which is nearly 14% higher than the previous year’s figures. The growth of insurance reserves indicates that insurance payouts will continue to increase in the future because insurance reserves reflect the volume of insurers’ future obligations.

The life insurance market, unlike risk insurance, is recovering at a slower pace but is showing a tendency for growth. Premiums for life insurance in the first half of 2023 increased by 2.4 million UAH compared to the same period in 2022.

Insurance payouts are growing at a slightly faster rate, and as of the end of the first half of 2023, they amounted to 576.2 million UAH (289.3 million UAH in the second quarter of 2023). This is once again the highest quarterly insurance payout figure in over 2 years, including the pre-war year of 2021.

As of June 30, 2023, life insurance reserves have increased and amount to 18.1 billion UAH, with assets totaling 22.1 billion UAH, indicating the financial stability of life insurers.

In addition, insurers paid 855.7 million UAH in profit tax to the budget in the first six months of 2023.

These are the results of insurers’ work during challenging times, demonstrating resilience, adaptability, and development. Continuous work and the improvement of customer service quality have become possible due to the financial stability of insurers and the implementation of advanced technologies in insurance. A consistent trend in the insurance industry in recent years is the active development of remote services in insurance, from contract signing to remote claims settlement. According to a survey among NAIU insurers in 2023, for the main lines of business (motor, property insurance, personal insurance), the share of electronic contracts (concluded remotely) is 66.5% of the total number of insurance contracts. The growth of electronic insurance contracts is a sustainable trend in the insurance market.

The positive trends in the insurance industry create a solid foundation for recovery. The next stage, which should also contribute to the recovery and development of the insurance sector, is the implementation of European directives as part of the insurance reform. Insurers have already begun active work to meet the requirements of the new Ukrainian Law on Insurance, which will come into effect on January 1, 2024. Enhanced or updated requirements in the areas of consumer rights protection, insurance product implementation, information disclosure, financial stability, internal management structure, and control are just a partial list of tasks for insurers in the first half of 2024. Today, the National Bank of Ukraine continues to actively develop the regulatory framework necessary for the implementation of the insurance reform. The coordinated interaction between the regulator and insurers, even in the conditions of russia’s full-scale invasion, instills confidence in the successful implementation of the mentioned reform.

Another issue that needs to be addressed is the issue of insuring military risks. This is a widely discussed issue in various forums and sectors. Citizens require financial protection due to injury, loss, or damage to property. Businesses need financial protection for their workforces and material-technical bases, and investors need protection for their investments.

Attracting significant investments into the Ukrainian economy is a necessary precondition for Ukraine’s recovery in the post-war years. Protecting investments is one of the key issues being addressed today by the government, our international partners, who are also working on creating mechanisms to guarantee investor protection. Today, insurers are ready to cover losses resulting from the use of war instruments within property, transportation, cargo, and personal insurance. With the expansion of reinsurance programs, the capabilities of Ukrainian insurers will significantly increase. However, insurance in conflict zones, areas with active combat, and occupied territories will be inaccessible.

Insurance of investments for local and foreign investors will only be available under the conditions of creating special guarantee institutions or procedures.

Insurers results for 9 months

Insurance exchange participants of PDMA have committed to disclosing their metrics every month, and the NAIU office is processing them promptly for the needs of the participants and all interested parties.

PDMA has already collected, consolidated, verified, and visualized the results of its participants’ work for the first 9 months of this year. As promised earlier, NAIU already has the data for all our insurers and insurance company ratings for the first 9 months of 2023.

These insurers diligently account for their metrics and voluntarily share them with the public. They have decided to report to their clients, partners, and even competitors. They disclose their performance metrics regardless of whether they are market leaders today. PDMA participants are insurers who demonstrate transparency not only formally.

We invite you to review the results for the first 9 months at https://www.nasu.com.ua.

Please note that the presented metrics and ratings, compiled based on these results, contain data exclusively for insurers participating in the PDMA project. The disclosure of information is done voluntarily by PDMA participants and is considered the best practice in the insurance market of Ukraine for disclosing information about the financial condition and performance of insurers. We expect to see the results of 9 months of the insurance market in November after the NBU publishes its results.

We will keep you informed of any updates, and you can independently explore metrics, trends, dynamics, make comparisons, and make informed choices here https://www.nasu.com.ua/indicator/

Strategic analysis and planning

Strategic analysis and planning. These are periodic meetings, strategic sessions of participants, which are held within the framework of NAIU and are dedicated to forecasting the state of the risk insurance market and vectors of its development.

Thus, another strategic session devoted to forecasting the risk insurance market for the end of 2023 was held recently.
At such meetings, we usually talk about the current state of the insurance market and discuss factors that may affect certain types of insurance. The trends of 2022 and 2023 were taken into account as a basis for forecasting, with distribution into the retail and corporate segments.

So, let us hasten to share with you the results of our vision.

According to the results of the first half of 2023, the insurance market grew by almost 25%, so the tendency towards gradual recovery is maintained.

 

In recent years, the first 5 places have traditionally been occupied by motor types of insurance (Motor Casco, OMTPL and Green Card), health insurance and property types.

We suggest to dwell on these species in more detail.

Therefore, Mototr Casco is forecast at the level of +20% both in terms of premiums and insurance contracts. In our opinion, this indicator is due to the revitalization of the new car sales market, as well as the growing demand and expansion of offers for the so-called “mini casco” programs.

When discussing mandatory motor types, such as OMTPL for the Green Card, taking into account the growing average premium, which is directly related to inflationary processes in Ukraine, we expect a growth of +20% for OMTPL, and for the Green Card it is closer to +30%.

We associate the growth of the Green Card not only with inflation, but also with a possible price increase, due to the fact that insurers have to adjust prices taking into account the growth of the average payment due to the change in the geography of our citizens’ stay in Europe. At the same time, we cautiously predict a decrease in the number of signed contracts within 5%.

Regarding health insurance, it is impossible to unequivocally indicate certain factors, except for inflation, and despite the slight growth (+4.6%), health insurance is confidently included in the TOP 5 types. This certainly reflects the ongoing process of relocation of enterprises from temporarily occupied territories, restoration of insurance for collectives, and therefore, in general, we expect an increase in the range of 11%.

As for property insurance, we see the preservation of trends in the growth of premiums from individuals, and therefore with the growing demand for such insurance (including from war risks) and the appearance of new offers, insurance programs on the market, we expect further growth within the 20- 25% We would like to remind you that according to the results of the first half of 2023, the receipt of premiums from individuals increased by 57% (+154 million UAH).

Separately, we offer to stop at cargo insurance. The NAIU community expects an increase in the same limits (20-25%) as property types, taking into account a certain recovery, and in some places an increase in exports of some product groups by more than 100% (compared to the first half of 2022). However, in the corporate segment, we remain less optimistic, because the recovery of the “global programs” of insurance is not happening as quickly as we would like, caused in our opinion by the security factor and the lack of full-fledged reinsurance in war conditions.

Unfortunately, with the impact of the war, we have negative consequences and trends in the insurance market for such types as aviation insurance, travel insurance, and therefore we predict a slow recovery and closely monitor changes in the market.

Of course, this forecast is not accurate or absolutely correct, but it can definitely serve as a certain signpost and a direction in which you can orient yourself, because the NAIU community unites insurers of different types of business and each of the participants is an expert.

Those who want to see our forecast in numbers are invited to visit our website.

The NAIU continues the path to a solvent, stable, competitve insurance market in Ukraine with proper protection of the rights of consumers of insurance services

And this is relevant not only for clients, but also for the insurers themselves.
We take another step on our way and present an overview of the new law of Ukraine “On Insurance”, the preparation and implementation of which is the task of this and the next years for the market and the NBU.

NAIU members received an overview of this Law from the Association Office shortly after its adoption, at the beginning of 2022.
Currently, we offer everyone to participate in learning and research in a convenient format on the section of our website osvita.nasu.com.ua.
Please note that the proposed review is exclusively informative and is the result of the NAIU Office’s own processing of the norms of the new Law of Ukraine “On Insurance”. It aims to provide insurers with methodological assistance in preparing for the implementation of the requirements of the new Law of Ukraine “On Insurance” and is exclusively an auxiliary material designed to facilitate preparation.

Simplifying financial monitoring without losing vigilance

The National Association of Insurers continues the joint search with stakeholders for ways to simplify financial monitoring by insurers while maintaining the obligation to achieve its objectives.

Currently, NAIU is grateful for the NBU’s support for the initiative to increase the limits on the volume of financial transactions carried out by PEP through the institution, from 200,000 UAH per quarter to 400,000 UAH per month.

The initiative of the NBU embodied in the NBU Resolution will ensure the same standards of financial monitoring for banking and non-banking institutions, as well as contribute to improving the efficiency of financial monitoring and reducing the burden on non-banking institutions, which will allow insurers to focus on the main aspects of their activities.

NAIU welcomes the Regulator’s understanding of the needs of insurers and will continue to jointly find ways to preserve the balance between business and the state.

The National Risk Assessment carried out by the State Financial Monitoring Service of Ukraine confirmed the classification of the most common types of insurance (CASCO, MTPL) as low-risk, which makes it possible, under favorable circumstances, to consider the issue of establishing simplified approaches to financial monitoring of certain types of insurance, and, following the FATF Recommendations, to exclude risk insurance activities in the future on the types of activities of financial institutions that are subject to FATF requirements.

Specialists of the members of the Association, who are part of the Financial Monitoring Committee of NAIU, thanks to constant professional development and exchange of experience in the Association, currently make up the vanguard of finmon in insurance, which gives confidence in the necessity of achieving the best results together.