Liberalization, insurance premium in a new light and foreign currency avoidance

The insurance sector in Belarus is waiting for amendments, Head of the Main Department of Insurance Supervision of the Ministry of Finance Sergei Osenko said.
The most significant changes are planned to affect life insurance and additional pension insurance. Looking ahead, the requirements to ensure the insurance organizations solvency will be adjusted. The insurance market continues to systematically grow and fulfill its protective function in the economy of the country. Over the past three years, the financial potential of insurance companies has increased: insurers’ assets grew 1.5 times to Br3.2 billion, total equity increased 1.3 times and amounted to Br1.5 billion. The investment resource has grown and the compensation function of insurance has increased. Insurance reserves, having increased 1.8 times, amounted to Br1.3 billion, insurance payments reached Br 0.5 billion (an increase of 1.6 times). The main trend of the recent years is the growth of demand for voluntary insurance of medical expenses and life insurance. If insurance premiums on voluntary insurance as a whole increased 1.5 times, then life insurance – 2.9 times, and as for medical expenses insurance – the growth was 3.7 times. The Ministry of Finance has started phased liberalization of the national insurance market and improvement of the conditions for conducting insurance activities. The segment of life insurance and additional pension insurance will undergo the most significant changes. The accelerated development of them require a particular urgency. In particular, it is proposed to lift a ban on the conclusion of life insurance contracts and additional pensions with non-state insurers by legal entities with a predominant share of the state and to cancel the condition for including insurance premiums into expenses under these agreements only if they are concluded with the state insurance organization.
Looking ahead, the requirements for ensuring the solvency of insurance organizations will change. Supervisory practice will be implemented by the requirements of the international standard for the calculation of capital requirements to ensure solvency.

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