Newspaper Insurer Press Issue No 11

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.

We offer our best wishes to our contributors, friends and well-wishers, who celebrate their birthday or name-day.

Many happy returns!

On page 2 we inform our readers that foundation “Banks Investments Money” together with Atlantic club in Bulgaria M3 Communications Group organize international financial exhibition and conference at June 07- 09, 2010 in Grand hotel “Sheraton”, Sofia.

This year it was conducted under the slogan - 20 years new banking in Bulgaria; experience and role of the financial sector in our recovery from the crisis.
At a ceremony, the Foundation presented its annual awards for "Financial Product of the Year 2010" and for the best insurance company.

In the category "Best general  insurance company for 2009" the prize was given to ZAD Allianz Bulgaria.
"Our strategic goal has always been to win the trust of our customers. For this purpose we  constantly look for their opinion  on our company products and quality of service. This award gives us confidence that we have taken the right direction and our efforts have an impact” said after receiving the award the Executive Director of ZAD Allianz Bulgaria Plamen Yalamov.
Insurance company “Bul Ins” AD received the grand prize "Financial Product of the Year 2010" in the category "General Insurance" for their products “HIT-Casco”, “VIP-Casco” and “Classic-Casco” insurance.

The prize was given to Prof. Stoyan Prodanov, CEO of insurance company “Bul Ins”. Insurance “HIT-Casco”, “VIP-Casco” and Casco Classic, are voluntary insurance covering total or partial loss of motor vehicles.
"This award is recognition of our professionalism and efforts, which we dedicate to our customers. Insurance company “Bul Ins” AD is one of the most innovative companies in Bulgaria and we can be sure that in the future we will continue to do everything necessary to provide only the best quality and the most reliable products our customers” commented Prof. Stoyan Prodanov.

On page 4 is “Theme to be continued: Changes in the Law for FSC”. The author Ioanna Stefanova is in search of the answer to the question: Will the choice of the new supervisors be delayed?

•        The changes in the law are ratified in the  “State Gazette” and already came into effect;

•        The actualization of national budget can  postpone the choice of members of the future FSC with almost a month.

The changes in the law of Financial Supervision Commission are finally accepted by the “National Assembly”. They are already ratified in the “State Gazette” and came into effect in the end of the last week. They predict that  in period of 14 days the new supervisors will be elected.

Menda Stoyanova, chairman of the parliamentary budget committee  says in front of “Newspaper Insurers Press” that the ruling majority is ready to meet this deadline. According to parliamentary experts the deadline may not be met because priority number one to this moment is the actualization of national budget.

The processing of the main financial law of the country for this year was discussed on first reading during the joint meeting of the budgetary and economic committee. The voting of the rest of the parliamentary commissions is due to take place, after which the draft project will enter for first reading in plenary hall of National Assembly. This can happen next week in the earliest. After that the procedure demands that there must be one or two weeks given to MPs to make their proposals before discussing the bill at second reading. The second vote is usually done text by text and takes more time. The discussion of this important law has to go through all the committees before entering the plenary hall. So even if the ministers act quickly, they will be able to adopt a final budget update not ealier than  the last but one or last week of July.This  means that if the choice of new supervisors will be postponed  for after the budget actualization, it will most likely be made in late July just before summer vacation of deputies.

On page 6 and 7 in “Analysis”: Insuring and voluntary health insurance” we comment on data of the insurance market and the market for voluntary health insurance at the end of March 2010. The conclusions, which  are made are:

•        The decline in general insurance for the first quarter was below 7 per cent annually;

•        The share of motor insurance increases

•        Life insurance grew with 4.4 per cent, but due to a change in accounting policy of a company

Gross premium income for first quarter of 2010, realized by insurers with a headquarter in the Republic of Bulgaria amounted to 408,421 thousand, with a  decline of 5.2% annually.

Gross premium income generated by life insurance companies for the period January-March 2010 amounted to 344,859 thousand, which is a decline of 6.8% annually.

On life insurance market share of motor insurance increased to 74.9 percent (first quarter 2009: 71.2%) of gross premium income generated in the sector, where civil liability insurance relating to the possession and use of motor vehicles (39.8%) exceeds the insurance “Autocasco” (35.1%).

ZAD “Vienna Insurance Group” maintains its leading place with 68,032,446BGN premium income and market share of 19.8 percent based on total premium income and 19.9 percent of base premium income from direct insurance

On the second place remains "DZI - General Insurance Plc. On the third place is insurance company “Bul Ins” AD. Gross premium income realized by life insurers January-March 2010 amounted to 63,562 thousand, which is a  grew of 4.4% annually.

The highest relative share in premium income for life insurance is taken by the insurance – “Life”  and annuity – 78,9%. The amount of premiums received on reinsurance is estimated to 60,327 thousand of which 1,596 thousand were recorded by insurers operating in life insurance. Recorded gross premium income from life insurers was achieved entirely by the direct business.

The first place is taken by “Allianz Bulgaria Life” with a

premium income of 11 579 764 BGN and a market share of 18.1%. After it is ranked  "Syndication VZK" and ZAD “DZI”.

On page 8 we inform about the annual meeting of insurance company “ Bul Ins”. The material is undoubtedly named: “How to win during a crisis”.

Example for distinguishing with serious achievements during a crisis in our country is insuring company “Bul Ins” AD. On June 3, 2010 it held its annual general meeting of shareholders in Sofia Hotel Central Plaza. The main conclusion made during the meeting is that: “with the reported data for the past 2009 , “Bul Inc” AD records positive results which show that although the crisis covered  all sectors of finance and economics, the company maintains its status quo as a leading insurer.”

In numbers the year 2009  for insurance company “Bul Ins” look like this:

• 130 830 million gross premium income,

• of which 95 087 million - for "Autocasco"

• and 29 919 million – for the civil liability of motorists.

• 60 450 million BGN paid benefits

• 96 319 million BGN transferable premium reserve and reserve for future payments.

• 5 775 million BGN net profit

• and paid 696 000 BGN profit tax.

• 21 million  BGN fixed capital.

On page 10 in the rubric “A look back, a look forward” we  talk to Peter Avramov, chairman of Managing board and  executive director of “XDI Insurance” AD.

Mr. Avramov says:

“ For “XDI Insurance” AD,and not only for it, the year 2009 was filled with many challenges and difficulties. The company ended the year with  2% growth of revenues from insurance premiums and a profit after tax amounted to 225 thousand BGN. "

On page 12-13 and 21 we reflect the working breakfast, on which the companies "Vienna Insurance Group Bulgaria announced the results for the quarter.

On June 2, top management of companies of "Vienna Insurance Group” invites on their traditional first annual meeting in  “Vienna” hall in the headquarters of the ZK"Bulgarian Property” AD representatives of leading financial and business media to acquaint it with results of the performance of companies for 2009 and first quarter of 2010.

First exposé was made by Mr. Rumen Yanchev. He characterized "Vienna Insurance Group (VIG) as one of the leading insurance groups in Central and Eastern Europe, bringing together nearly 50 insurance companies in CEE with over 20,000 employees, which makes it a major international employer.

“Year 2009 is a history now, but it left behind itself many problems - collection of premiums, termination of a number of policies, aggravated criminal situation ... Insurance "Civil Liability" appears as a savior of premium income, but it is a millstone for any insurer that offers it. Not only the results for the first quarter of 2010 are not more optimistic, said Mr Yanchev but also the decline is slightly greater than throughout the whole 2009, especially in some sectors, and above all in motor insurance.

Expectations about this year are not going out of this state unless the insurance “Civil  Liability”  does show growth which can delete the lagging, but this is hardly the best scenario.

For the first three months of 2010 there is also a fall in the market and the results for April and May confirmed this trend in almost all types of insurance."

On page 15 and 17 we meet you with several leading brokers. Ivan Sivov, owner and manager of a national insurance broker "Sivov-Group” Ltd says: “Every person who works in our field is good in his/her own way. Behind the successful business there always is someone’s brave decision.”

Diana Atanasova, manager of “Carroll Standard” Ltd., a licensed insurance broker and insurance intermediary. Mrs Atanassova pointed out: “Most of our competitors focused on a targeted supply of one or more insurance products. We offer a wide range of insurance products at competitive prices, while selecting and fitting the best product to the high requirements  of our customers”.

On page 20 and 22 we present to you  Rumi Bojkova, owner and manager of the company "Marty Ltd" - one of the two largest importers of "Body Parts"- car parts in our country. Ms. Bojkova says: "My idea is to have a closer contact with insurance companies than the one we have so far which is only informational.