YEREVAN, November 13. /ARKA/. Insurance bonuses in Armenia reach 0.7-0.8% of the GDP and tend to grow, deputy head of the Central Bank of Armenia (CBA) Nerses Yeritsyan said at a conference on Armenia’s insurance market on Wednesday.
Yeritsyan said Armenia has made good achievements in insurance since 2006 with premiums having hiked to 0.7-0.8% of the GDP. The respective global indicator is 2%, without life insurance. Only countries with mandatory insurance have higher levels, Yeritsyan said.
The deputy head of the central bank said the main potential for development is found in long-term life insurance.
The percentage of the premiums may be brought up to 2-3% of the GDP if respective studies are carried out and a strategy is developed, he said. It can be as high as 10-12% of the gross domestic product after introduction of life insurance in the country.
According to Yeritsyan, the insurance system may become the second in the financial sector of Armenia in the next years in terms of assets and collection of premiums, which indicates certain public interest.
For the system to develop long-term insurance savings should be formed and diversified ways to invest should be used so that people get more out of their contributions to a compound institution. Insurance companies that have the highest income may serve such institution, if there are skills to assess the risks and to ensure stability of the operations, Yeritsyan said.
According to the central bank, Armenian insurance companies assets amounted to 44.1 billion drams as of the end of September 2014, an increase of 6.3% compared to the same period of the year before. Liabilities were 27.2bln drams (16.8% reduction), capital 16.9bln drams (17.2% increase).
Net profit of insurance companies totaled 2,350.4 million drams against 338 million drams in loss in the same quarter of 2013.
There were 6 insurance companies operating in Armenia as of the end of September. ($1 – 415.33 drams).–0-
