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Insurersʼ premium revenues rise 7.1% in 2018

Hungarian insurersʼ revenues from premiums rose 7.1% in 2018 to HUF 1,024 billion, fresh data compiled by the National Bank of Hungary (MNB) show, state news agency MTI reported.

Revenue from premiums on life insurance policies rose 3.5% to HUF 476.7 bln for the year. Revenue from non-life insurance premiums increased 10.5% annually to HUF 547.3 bln.

In the fourth quarter of 2018 alone, revenue from premiums edged up 1% compared to the corresponding period a year earlier, to HUF 247.2 bln. Revenue in the life insurance sector amounted to HUF 118.7 bln, and in the non-life sector to HUF 128.5 bln.

In Q4 2018, home insurance policies generated over HUF 29.5 bln in revenue from premiums, revenue from premiums on mandatory vehicle insurance was over HUF 40 bln, and revenue from premiums on comprehensive vehicle insurance nearly HUF 22.8 bln.

Unit-linked or index-linked life insurance provided HUF 56.2 bln premiums in Q4, and retirement insurance policies HUF 20.7 bln.

The number of insurance contracts was up 3.64% in 2018 compared to 2017, at 13.91 million. There were 2.39 mln life insurance contracts, down by a marginal 0.1%, and 11.52 mln non-life contracts following a 4.4% rise.

Damages paid out by insurers totaled HUF 364.1 bln for life insurance contracts, and HUF 232.9 bln for non-life contracts last year. The amounts were down 0.1% and up 2.4%, respectively.

The MNB gathered data from 23 insurers, including six life insurance companies, nine non-life insurers, and eight composite insurers. Data show combined pre-tax profit of HUF 77.75 bln in 2018, up 13% for the year, while after-tax profit was up 12.6% at HUF 72.87 bln.

The capital adequacy ratio calculated at sector level, and according to the Solvency II regulatory framework which entered into force on January 1, 2016, stood at 220.9% at the end of Q4 2018. The ratio was down from 225.4% at the end of Q4 2017, but up from 213.4% in Q3 2018.

The ratio significantly exceeded the requirements of 100% prescribed by law and the prudentially required 150% under the MNBʼs statutory provision recommendation increased by a volatility capital buffer.

Around 65% of insurance companies (15 institutions) had their solvency margin ratio, calculated from eligible own funds and the solvency capital requirement, above 200%.

At the end of Q4, investments linked to insurance contracts managed by insurers were comprised of 50.7% of government bonds, 33.1% of collective investment undertakings, and 4.1% of equities.