YEREVAN, September 5. /ARKA/. Insurance penetration in Armenia remains low, particularly in agriculture and property insurance, according to the International Monetary Fund’s report “Armenia: Climate Policy Diagnostic – July 2026,” published on September 3, 2026.
The IMF notes that Armenia has established a strong legal and institutional framework for disaster risk management, including the 2025 Law on Disaster Risk Management. However, significant implementation gaps remain.
According to the Fund, risk assessment remains fragmented, coverage and enforcement of building codes are incomplete, modernization and strengthening of existing facilities is limited, and early warning systems remain underdeveloped.
The IMF also notes that fiscal resilience is limited by insufficient disaster risk data, limited fiscal risk analysis, fragmented institutional responsibilities, and reliance on post-disaster budget reallocations.
To enhance resilience, the Fund recommends ensuring the practical implementation of the law through clearer responsibilities and standardized methodologies, improving infrastructure standards and early warning systems, integrating disaster risks into fiscal planning, expanding contingency financing instruments, and promoting the development of the insurance market.
According to IMF estimates from June, Armenia’s state budget deficit in 2026 is expected to be 4% of GDP, and central government gross debt at 48.7% of GDP. For comparison, in 2025, the budget deficit was 3.7% of GDP, and central government debt was 47.3% of GDP.
Armenia’s 2026 state budget law initially projected a deficit of 536.8 billion drams. The IMF subsequently noted that higher-than-expected revenues allowed the authorities to target a deficit of approximately 4% of GDP, instead of the budgeted 4.5%.
