Newspaper Insurer Press Issue no 2 (28 January – 11 February 2009) with an accent put on the highlights, hot topics and comments

05 Февруари 2009 г.,
Dear readers, in the overview of the newspaper «Insurer Press» we put an accent on the highlights and hot topics news and events. We make you acquainted with the analyses and thoughts expressed by the leading insurers and also keep you informed about all that happened within the period between the last two issues of the newspaper.

 Newspaper Insurer Press Issue no 2 (28 January – 11 February 2009) with an accent put on the highlights, hot topics and comments


We offer our best wishes to our contributors, friends and well-wishers who celebrate their birthday in this period!

Happy new returns and all the best!

Under the regular heading «Between two issues» on page 2 a place is given to the news from the Financial Supervision Commission (FSC), among others the one that Mrs. Ralitsa Againe, Deputy Chairperson, Bulgarian Financial Supervision Commission Head of Insurance Supervision Directorate, issued a decision, approving Petra Klvacova-Cooper for Member of the Board and CEO of GP Reinsurance EAD. With a separate decision she rejected the candidature of Dimitar Tanchev   for Member of the Board and CEO of „Generali Life Insurance” AD.


Mrs. Again has also issued decisions for approval of Mr. Todor Tabakov for Member of the Supervisory Board of Life Insurance Company Bulgarski Imoti AD and for Member of the Supervisory Board Joint Stock Insurance Company „Bulstrad Life AD.

On page 2 and 6 we reflect the Award Ceremony and the bestowing of prize on  Vladimir Todorov in the initiative Worthy Bulgarians.  At the official ceremony, held on 19 January the present year, in Sredets Hall, Sheraton Sofia Hotel Balkan, the Prime Minister Sergei Stanishev gave the Golden Rhyton to Vladimir Todorov from the Bulgarian association of people who suffered in car accidents /BAZK/ . In the last 4 years the association has been providing legal and medical help to people who have wanted to defend their rights


On page 2 and 6 we publish the data about the situation on the Insurance and Health Insurance market, November 2008 ended. Here we carry the information about the determined minimum profitability of the pension funds for the prior 24-months period as from 29.12.2006 to 30.12.2008.

On the same page you can read some comments on the adopted by FSC Ordinance on the documents, issued in case of Road Traffic Accidents (RTA)


On page 3 is our conversation with Rick Jansen, CEO of Insurance Joint Stock Company (IJSC) DZI, and of IJSC DZI- General Insurance.  According to him, DZI came to the expectations of KBC. He answered the questions that have worried all of us “What would be the impact of the crisis on the Insurance market in the country? Is it possible for the Bulgarian insurance business to become „peaceful island” in the lately turbulent sea of the world finance and why? “, Mr. Jansen answers that, the crisis would have its impact on Bulgaria. But the worst scenario would not come because the later the crisis would hit Bulgaria, the better the country would be prepared. For specific medication he indicated the provision of adequate credit, incl. the slacking of the tightened standards for mandatory minimum reserves of the commercial banks.


On pages 4 and 14 in the Cover Story, Ileana Stoyanova is providing an analysis of the mountain insurance. This insurance has been launched in 1999 and is an alternative of the high-priced payment for the services of the Mountain Rescue teams, which became mandatory as from 2000. The goal of this product is to provide insurance protection during the performance of sport and tourist activities  in the mountain, including the use of ski facilities, because the National Health Insurance Fund does not cover this type of expenses. The product has two options – individual and group, and the prices differ and are significantly lower for groups of over 30 persons. The author indicates the prices of some of the insurance companies.


On page 5 we publish the conversation with Lyubima Oleva – General Representative of Allianz Bulgaria in Blagoevgrad. According to her Allianz Bulgaria is reliable partner and behind the digits she can see life stories. During her work with the clients she relies on the mutual confidence.


On pages 7 and 16 we carry the interview with Reader Dr. Jordan Hristoskov, Governor of the National Social Security Institute (NSSI). Dr. Hristoskov emphasized that in the last year an old pension insurance issue was resolved – the pensions granted in the period FY 2000-2007 was 8%-10% in arrear from the newly granted pensions in 2008. He indicates the new moments in the FY 2009 – the reduction of pension contributions became feasible with the introduction of the state as insurer. The now existing contributions payable to Pensions fund are 30%, but in practice 12% are assumed by the state 12% and things being so, the worker is paying 8 % and the employer – the rest. However this measure joined the increase of the Health insurance contribution from 6% to 8%. Mr. Hristoskov also answered questions about the increase and recalculation of the pensions.  The ceiling on the pensions will be lifted in  2010.He also shared that the biggest advantage of the Bulgarian legislation is the fact it succeeded to merge in just one law the whole social security matter. Being one of the nine insurance risks, the health insurance should be also included in this Code. Regarding the “Silver” fund issue, Mr. Hristoskov thinks that this fund would play a positive role.


On page 8   in the column Seminar you can read the continuation from the last issue of the material from the seminar   «Motor Insurance Pricing – science, art or just a business»,   held on 17 November 2008 at the metropolitanCentral Park Hotel”. In this issue the lecturer Georgy Matov is dwelling upon the mechanism of the insurance cycle, the position and the role of the Supervision and the distribution channels.


On page 9 in the column Forum we carry the interview with Prof.Dr. Martin Balleer, Member of the German Actuary Association and Member of the Board of Directors of the European Actuarial Academy. According to him, the challenge faced by the actuaries is to make their way into the risk management where the mistakes are not allowed. He thinks that in 5 years the Bulgarian actuaries will achieve the professionalism of their West-European colleagues.


On pages 10 and 11, in Seminar we continue the publication of the materials from the seminar with international participation, held on 25 and 26 November in Plovdiv, with theme «Republic of Bulgaria – member-country of the European Union – the challenges of Motor Third Party Liability (MTPL) Insurance issue». We publish the summary of the report, delivered by

 Tzvetanka Krumova, Member of the Board and Executive Director, Armeets Insurance and reinsurance company, and the report of the lawyer Diana Dimitrova from the Lawyers Association  „Antoaneta Domolarova, Roza Gradinarova and partners” with theme „Motor Third Party Liability (MTPL) insurance policy claim settlement  – current legislation issues”

At the very beginning of her presentation, Mrs. Krumova emphasized that during the last 10 years the Bulgarian insurance market has never been a peaceful place. The framework of the regulated marked has been created 10 years ago by the establishment of a specialized state body for supervision, company licensing and special legislation.

During this period the MTPL insurance has invariably been the main theme, problem and focus of attention. The legislation requirement for 1 calendar year term of the MTPL, which was applicable for long, reduced to the status of Charismas Impossible for the insurers because of the heaps of insurance policies, subject to renewal in the end of the calendar year.  The contracting of MTPL insurance was called “campaign”. For a short time in the end of the year the competition used to become bitter, even desperate – by use all possible marketing devices, any allowed and not as all allowed means have been applied in the struggle for a market share, including even unique and out of standard marketing ideas.  According to Mrs Krumova, the insurers realized that the MTPL is the key to the heart of the customer. Despite the harmonisation in many areas of the law, the principles of the principles of the third party liability in the separate countries still differ, Mrs Krumova emphasized. Тя She determined Bulgaria as a country, pertaining to the group of states where the liability is based on a culpable conduct. Mrs. Krumova dwelled on the problem with the  за poor participants in the road traffic, the Sixth Directive draft, etc.

On page 11 lawyer Dimitrova is explaining the MTPL insurance policy claim settlement practices and the current legislation issues.


On page 12 we continue the publication of the materials from the Seventh National Conference with international participation: «Social Security and Insurance in Bulgaria under the conditions of eurointegration: challenges before the yet continuing adaptation». In this issue you can read the final part of the report, delivered by

Ralitsa Againe, “PROBLEMS AND CHALLENGES BEFORE THE VOLUNTARY HEALTH INSURANCE SYSTEM IN THE CONTEX OF THE EUROPEAN SOCIAL MODEL”. There are explored the main differences in the regulation and supervision of the health insurance and the insurance activity in Republic of Bulgaria.

On pages 15 and 17 we carry the speech delivered by Stephan Stoilkov, Head of Department “Regulation Policy and Analyses”, Financial Supervision Commission, before the same conference. He is making an analysis of the development of the insurance in the country after the Bulgarian accessment to the EU.


On pages 13 and 16  under the column In the occasion we publish the conversation with Reader 

 Dr.  Boian Iliev, Deputy Manger of the Chair “Insurance and Social Security”, D.A.Tsenov Academy of Economics – Svistov, Head of Council of the Specialty “Insurance and Social Security”, Higher School of Insurance and Finance (VUZF). Reader Dr. Iliev is telling the story of his professional path of scientist and lecturer.


On pages 19 and 21 in the column Look back, look forth we are talking with Reader Dr. Stoyan Prodanov, CEO and Deputy Chair, Insurance Company BUL INS.  Mr. Prodanov answers questions about the results, the activity, the philosophy and the policy of the company.  He shares that in 2009 there are expectations for differentiation of the separate subjects on the insurance market and a growth of 10%.  Regarding the hot topic of the MTPL price he said: “The majority of the insurers are expecting a new rise of the price. And this rise would not be the last because in a long term this insurance is targeting higher levels. In average term aspect our expectations are for EUR 250-300 for the mass class of cars. In particular Insurance Company BUL INS has already increased the prices by 50% even as early as in August 2008”.

Regarding the bilateral protocols Mr. Prodanov thinks that it should be better to synchronize the implementation of the both projects – the of the Loyal Clients System “Bonus - malus” and the bilateral protocols.


On page 20 we narrate with text and pictures the first in a kind project in the high education in Bulgaria. On 16 January 2009, at an official ceremony, held in Sofia Hotel,

 Dr. Susan Aldridge – President of University of Maryland University College and  Reader Dr. Grigorii Vazov – President  Higher School of Insurance and Finance, signed the first in Bulgaria  Mutual Education Program Agreement between Bulgarian and foreign high school.  

           We finish our overview with the interview given by Dr. Susan Aldridge for the newspaper Insurance Press /pages 20 and 22/. There Dr. Aldridge optimistically declared: «We start now a mutual program for education of bachelors, and we have the ambition further to start a magister program. »



Selection: Vania Petrova

Translation: Albena Dimitrova


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