The audited profit for the last year of BTA Baltic Insurance Company (hereinafter – BTA), which after the reorganization of its parent company BTA Insurance Company SE succeeded to its Baltic States business portfolio and actually started operation on 1 July 2015, was 4.2 million euros. Keeping on sustaining its strong positions on the Baltic market arena, in 2016 BTA is more active in corporate customers segment, and expanding the business volumes in Estonia.
According to BTA Board Chairman Jānis Lucaus, after the reorganization of BTA Insurance Company SE – its parent company, the ultimate goal of BTA is to carry on the development of BTA on the Baltic market by offering good quality and competitive products, keeping BTA among the insurance market leaders in the Baltic States. “The company development steps taken by now have been on the right path, the good financial results confirm this. Within the timeframe between 1 July 2015 and 31 December 2015 BTA had written gross insurance premiums of 55.7 million euros. Despite of 35.6 million euros disbursed by BTA as total gross insurance claims paid, its audited profit before tax for six months was 4.2 million euros. To further the successful development of BTA and achieve good results, our priorities last year were balancing of the insurance portfolio, optimization of administrative processes and operating costs. As a result of that, we achieved one of the best combined ratios in the Baltic States (93.1%) among the leading Baltic insurance market players,” says J.Lucaus.
Characterizing the Baltic States insurance market, where BTA operates, Mr. Lucaus emphasizes that the market keeps developing, a fact suggested by the stable volumes of gross written premiums as well as emergence and development of various insurance products, especially in voluntary insurance, which in turn indicates of a still increasing awareness of people of the need for insurance and the financial safety it provides.
Looking at the financial results for the insurance portfolio taken over form the parent company on 1 July 2015, the volume of gross insurance premiums written last year had reached the level of 2014. The volume of gross written premiums in the Baltic States reached 114 million euros in 2015. By insurance types, the previously positive tendency is still there, and namely – the volume of gross written premiums in voluntary insurance type had grown in the Baltic States on whole as well as by each individual country. The volume of gross written premiums in voluntary insurance types together for the Baltic States reached 74.4 million euros, which is by 4.4% more than in 2014. A significant growth of gross written premiums in the Baltic States has been achieved in personal accidents insurance (+18.9%), in CASCO insurance (+7.6%) and property insurance (+6.9%).
As regards the business portfolio taken over, a total of 70.5 million euros were disbursed in payments for gross insurance claims in the Baltic States last year, which is by 15.3% more than it was in 2014. The last year’s growth in payments for insurance claims was driven by the growing number of road traffic accidents, and a rise in car repair shop fees in all three Baltic States, as well as the increase in medical treatment fees in Latvia and Lithuania.
At the same time, the competition levels on the Baltic insurance market remained very high. In all three Baltic countries every client is a target of fierce competition, which was further ignited by changes in the shareholding structures of other insurance market players. The tightest competition is observed in motor insurance. For a number of years, the MTPLI segment operates at a loss in Latvia as well as Estonia. The fierce competition on the market is keeping the prices of MTPL policies down, preventing them to be raised to levels that were adequate to the objective costs in this insurance type. The rise in expenses was brought by the growing number of road traffic accidents and the climb of car repair costs in all three Baltic countries.
Likewise in other industries, the use of distance communication channels tend to grow also in the insurance industry, an increasing number of customers send applications and purchase insurance services online. In Lithuania, the volume of gross written premiums of insurance products purchased online has grown last year by 11%. In Latvia, the levels of gross written premiums of insurance products purchased online have remained flat – as in 2014. As part of customer service development, last year BTA improved claim placing opportunities via means of distances communication. In 2015, 98% of the overall number of claims in Latvia were registered with the Customer Support Service remotely, this number was 90% in Estonia and 71% in Lithuania. This is an indication that customers with increased frequency prefer using various mobile and e-platforms to purchase insurance products, as well as place claims.
Keeping up the positive development tendency, the BTA Board, composed of the Board Chairman Jānis Lucaus, and Board Members Oskars Hartmanis and Evija Matveja, have set the following priorities for 2016: stimulate the company’s activity in the corporate customer segment by offering competitive products, and expand the business volumes in the Baltic States, especially in Estonia, as its market has indications for a growth potential. By introducing an investor – the Austrian insurer Vienna Insurance Group AG and retaining the brand of BTA, its traditions and values, BTA this year is going to improve and expand the range of products offered, to capitalize on the international experience of a group, having industry know-how, accumulated over the course of 190 years.
About the company
AAS BTA Baltic Insurance Company was founded in 2014, after reorganisation of BTA Insurance Company SE, performing successful division of the company according to the geographical distribution of its business operations: the Baltic States and the rest of Europe. BTA Insurance Company SE, the parent company of AAS BTA Baltic Insurance Company, has been successfully operating on the insurance market for more than 20 years, in 2009 becoming the third biggest insurer in the Baltic States. Evidence of the international growth of BTA is the TOP 500 of Central European Companies, published for year 2013 as a result of study by the international auditors Deloitte, where BTA was ranked among the 50 largest insurance companies in the Central Europe.
In December 2015, AAS BTA Baltic Insurance Company concluded a contract on attraction of an investor – one of the leading insurers in Europe – Vienna Insurance Group AG (VIG). The transaction will be completed after receiving all the necessary permits from the supervisory authorities of the industry, which might take place in the first six months of 2016.
Information prepared by:
Public Relations Manager
AAS BTA Baltic Insurance Company
Phone: +371 67025661, mobile 27828796