Q1 2018 overview of non-life insurance sector

Finantsinspektsioon has published a short review of the developments in the Estonian non-life insurance sector in the first quarter of 2018 and of the main risks to the sector. 

Estonian non-life insurance companies together with their branches received insurance premiums of 151 million euros in the first quarter of 2018, which is one fifth more than in the final quarter of 2017. This was 28% more than a year earlier, which partly reflects bookkeeping changes in how premiums are recorded. All the insurance companies saw premium volumes increase.

Key Indicators

Q4 2017   Q1 2018
Premiums written 126 mln € 151 mln €
Claims incurred 64 mln € 74 mln €
Total assets 747 mln € 769 mln €
Net combined ratio 88,2% 90,4%
Profit 11,2 mln € 8,7 mln €
Solvency capital requirement coverage ratio 209% 209%


Claims incurred amounted to 74 million euros in the first quarter, which is 15% more than in the fourth quarter of 2017.

The size of the Estonian non-life insurance market, together with branches of foreign insurers, was 102 million euros by the end of the first quarter.

The combined ratio of non-life insurers, which is the loss ratio together with the expense ratio, stood at 90.4% in the first quarter. This means the market as a whole was technically in profit as the combined ratio was below 100%.

Non-life insurers earned 8.7 million euros in profit in the first quarter. The majority of the profit is still earned from insurance activities, and the main source of profit is property insurance. Only two of the seven non-life insurance companies didn’t earn a profit.

The capitalisation of the non-life insurance sector remains good, and the solvency capital requirement coverage ratio with eligible own funds was 209% in the first quarter. All non-life insurance companies met the requirement.

Main development trends and risks

  • Growth remains fast in the non-life insurance sector and the sector is in profit.
  • Losses on motor third-party liability insurance have been reduced by higher tariffs throughout the Baltic region. The loss made by Estonian non-life insurance companies on motor third-party liability insurance in the Baltic region was 360,000 euros for the quarter, which is the lowest level of recent years. The loss in Estonia on motor third-party liability insurance in the first quarter was 1.1 million euros, which is comparable to the amount in the first quarter of last year.
  • The non-life insurance sector is well capitalised. All insurers meet the solvency and minimum capital requirements. There are problems with meeting the Solvency 2 qualitative requirements.