The COVID-19 pandemic in 2020 and the sharp decline in global oil prices has led to lower non-life premium income for many Russian insurers. However, according to a new AM Best report, life insurance premiums grew in the first nine months of 2020 as policyholders responded to the country’s low interest rate environment and regulatory actions taken to improve customer trust.
In the new Best's Market Segment Report, “COVID-19 and the Russian Insurance Market: Negative Implications for Premium Growth, but Opportunities for Innovation,” AM Best notes that while COVID-19 presented challenges to Russian insurers, it also highlighted the increasingly important role of innovation and digitalisation in the market. Prior to the pandemic, insurers were already investing in developing platforms or applications, enabling online sales and other remote services. However, while the sudden need to work remotely caught some of these insurers by surprise as they were still rolling out their digital platforms, others with more advanced IT solutions continued to sell their policies online without major disruptions and even increased use of this channel.
AM Best also believes that the shift in customer behaviour and expectations post-pandemic is likely to lead to some Russian insurers reviewing their business models in terms of their suitability for online services, not only in distribution but also with respect to underwriting and claims handling. This is likely to have long-term positive implications for the development of the industry.
To access a complimentary copy of this special report, please visit http://www3.ambest.com/bestweek/purchase.asp?record_code=306199.
A video discussion on this report with AM Best Associate Director Valeria Ermakova and Financial Analyst Todor Kitin is available in English at http://www.ambest.com/v.asp?v=ambrussianreport_english221 or in Russian at http://www.ambest.com/v.asp?v=ambrussianreport_russian221.
AM Best is a global credit rating agency, news publisher and data analytics provider specialising in the insurance industry. Headquartered in the United States, the company does business in over 100 countries with regional offices in London, Amsterdam, Dubai, Hong Kong, Singapore and Mexico City. For more information, visit www.ambest.com.
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