Bulgarian insurance market
The top 5 insurance groups generated around 58% of the total premium volume in Bulgaria in the first three quarters of 2019. The two largest insurance groups generated around 28%.
The Bulgarian insurance market continued to grow rapidly in the first three quarters of 2019, recording a double-digit year-on-year increase of 17.2% in local currency terms. Growth in both the non-life (+17.4%) and life (+16.2%) sectors contributed to this respectable increase.
Motor third party liability insurance generated around 46% of the premium volume in the non-life sector. With strong growth of 21.1% it played a major role in the increase in the non-life sector. Many insurance companies have already taken introduction of the bonus-malus system into account in their prices. Motor own damage insurance recorded an increase of 6.1%. The non-motor lines of business recorded impressive double-digit growth of 24.1%.
Life insurance achieved a remarkable increase of 16.2% in the 1st to 3rd quarters of 2019, following the decrease during the same period in the previous year. The growth was driven by health insurance products in the life insurance sector (+81.5%) and unit-linked and index-linked life insurance (+18.1%). Traditional life insurance and annuity insurance, on the other hand, recorded a moderate change (+2.2%).
An average of EUR 26 per capita was spent on life insurance in Bulgaria in 2018. Around six times as much, EUR 158, was spent on non-life insurance. According to Axco Global Statistics, this corresponds to a total per capita premium of EUR 184 per year for insurance services.
VIG companies in Bulgaria
The three insurance companies Bulstrad Life, Bulstrad Non-Life and Nova are represented in the Bulgarian insurance market. Together they have a market share of 15.1%. That makes the VIG insurance companies the leading insurance group in Bulgaria. It holds second place in the non-life sector and first place in the market for life insurance. The PAC Doverie pension fund also belongs to VIG Insurance Group.
Financial performance indicators in the Bulgaria segment
Premiums written in the Bulgaria segment increased to EUR 223.9 million in 2019 (2018: EUR 171.3 million). The major increase of 30.7% was primarily due to good performance in health insurance, the motor lines of business and other property and casualty insurance. Net earned premiums were EUR 137.7 million in 2019, 12.1% higher than the previous year.
Result before taxes
The Bulgarian VIG companies contributed EUR 15.8 million to the total Group result in 2019 (2018: EUR 11.4 million). Improvement in the combined ratio played a key role in this significant increase of 38.2%.
The combined ratio improved considerably to 95.8% in 2019, mainly due to an increase in average premiums in the motor lines of business and greater profitability in other property and casualty insurance (2018: 99.1%).