Croatia Insurance Report Q2 2016
BMI View: Croatia's insurance market remains underdeveloped, with low rates of penetration and densityin both the life and larger non-life segments. Growth has been hampered by low average household incomelevels as well as a lack of uptake of formal banking services among a large share of the population. Movingforward, we are forecasting slow but steady growth in the life sector, bolstered by supporting demographictrends as well as falling unemployment and rising household income rates. Growth will be slower in thenon-life sector, largely due to a flat autos market which is dampening demand for motor insurance - thelargest share of the non-life market.
Key Updates And Forecasts
Following an extensive restructuring process and HRK840mn recapitalisation, Adris, owner of largestdomestic firm CROATIA Osiguranje, has announced plans to invest some HRK2bn in its insurancebusiness between 2016 and 2018 as it attempts to strengthen its ailing position in the non-life market andto expand in the region.
The non-life product offering continues to expand. In January 2016, Croatian mobile phone companyVipnet announced it had partnered with insurance firm BNP Paribas Cardif Insurance to providemobile phone insurance cover for both individuals and businesses which customers can access via theirVip subscriber account at a monthly cost of around HRK15.
We are currently forecasting average annual growth of 4.3% in the life sector and 2.9% in the non-lifesector (in local currency terms) between 2016 and 2020 as the stagnant motor sector continues to weighupon growth in the larger non-life sector.
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