Банкеръ Weekly



Bulstrad's 1Q financial results definitely crushed the competitive general insurance companies. The company has realised an impressive premium revenue amounting to BGL30.198MN, which is a 31.56% market share. This is a good start, as for the total 2000 the insurance company has reported premium revenue of BGL67.5MN, and its market share was 19.7%. Bulstrad managers explained that 20% of the 1Q income come from the sale of the mandatory Civil Responsibility insurance, and the remaining 80% - from other types of insurance products.
At the end of last year the difference between the first ranked general insurance companies was just several hundred thousand Bulgarian levs, while now it is several million. If Bulstrad manages to keep the speed in selling its insurance products, a record premium revenue of about BGL115 - 120MN at the year end will not be a surprise. And there is a good basis for such forecast. The changed visa requirements for the Schengen countries made a number of Bulgarians travel in Europe in their own cars. Still for their international travels they need the Green Card insurance, and Bulstrad is the only company authorised to sell it, and the company will definitely retain its monopolistic status till the end of this year.
Allianz Bulgaria moves to a higher rank at the local general insurance market. The 1Q market share of the Bulgarian - German insurance company is about 18.26%, and it ranks second. Allianz Bulgaria premium revenue for the period January - March is BGL17.47MN. If it keeps the same pace till the end of this year it will be able to report premium revenue of about BGL70MN.
Last year general insurance leader was displaced. DZI General Insurance premium revenue for the 1Q amounts to BGL15.85MN, and this is 16.57% market share. Just for comparison: the state insurer's revenue in 2000 amounted to BGL68MN, and its market share was 19.85%. Comparing the 2000 1Q and the 2001 1Q company revenues shows that financial results are now better, but they are not sufficient for the state insurer to keep the leading position it has occupied during the last couple of years. An interesting fact about DZI General Insurance is the substantial decrease of compensations it has paid. Its managers claim that this fact is much more significant for them than the slight increase of premium revenue. Claimed and respectively paid compensations have decreased almost two times for the period in question.
These financial results are really favourable for DZI, having in mind that it is subject to sale. During the last year or two the company was reporting losses. Only for 2000 it amounted to BGL3MN. If the tendency remains, by the end of this year DZI General Insurance may even expect a minimum profit, or at least a minimum loss.
In the beginning of this year Bul Ins keeps its position, ranking fourth. Not like in 2000, however, both its market share and its premium revenue are considerably lower. For the 1Q the company revenues amount to BGL8.619MN, and its market share is just 9%. For comparison: the 2000 revenues amounted to BGL50.634MN, which meant a 14.78% market share. It is true that Bul Ins is the biggest car insurer in Bulgaria, and the tradition for this type of contracts is to be renewed in the end of each year. From this point of view it could be expected that the 1Q lag behind will be compensated later.
Vitosha Insurance Co., a traditionally good insurer, has also improved its ranking. While it ranked seventh in 2000, for the 1Q it moved fifth. Its premium revenue amounted to BGL5.058MN and its market share to 5.29%. Besides the high professionalism of its staff an important contribution to the company success had Simeon II, who became its shareholder a year ago, said some humorous comments.
The retreat of Orel and Energia for the discussed period is more remarkable. The first company was a hit in 1999 when it surprisingly for the experts ranked fifth at the general insurance market. Now the company has gone one position down, and its premium revenue is much more modest compared to previous years.
As for Energia its situation in the end of 1Q is rather worrying. In 2000 the company realised premium revenue of BGL17.984, which meant 5.25% market share, ranking sixth at the general insurance market. The revenue for the period January - March is impressively low - BGL528,000, which is just 0.55% market share, and the company is ranking sixteenth among general insurers. It should be taken into consideration, of course, that this is a specialised company with a limited number of clients, which usually renew their contracts in the end of each year and the annual result is balanced. Yet, the comfort which this kind of monopolistic status had brought to Energia is about to fade away. On the one hand NEK is undergoing transformations and a number of its subsidiaries may not renew their contracts with this specific company. On the other - a number of insurance companies are already carefully monitoring the energy sector.
As a whole the growth in general insurance for the 1Q compared to the same period in 2000 is about 12%, and the total amount of premium revenues exceeds BGL95.679MN, while the premium revenue of general insurance companies for the whole 2000 amounted to BGL342.573MN.

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