Russian insurance market defies pandemic with 4.1% growth in 2020

The volume of insurance premiums exceeded 1.5 trillion rubles. Although insurance premiums turned down temporarily in the second quarter when the toughest restrictions were in place, the market resumed growth as early as the third quarter as restrictions were relaxed. These are the findings of Review of Key Indicators of Insurers.

Endowment life insurance and insurance segments related to lending emerged as key growth drivers in the sector. The voluntary medical insurance market was hit hardest by adverse pandemic effects. This primarily came as a result of a drop in demand for medical insurance programmes from consumers and small-sized companies.

Insurance payouts went up 8.1% to 659.3 billion rubles in 2020. Payouts were at their all-year low in the second quarter as a decline in all core business activities and road trips pushed insured accidents lower.

Insurance companies overall weathered through challenging economic times with good outcomes and kept financial reserves. Return on capital (30%) edged lower but remained the highest of all key Russian financial system segments. Profits grew marginally on last year to 247.5 billion rubles. The growth was mainly attributable to investment income (due to foreign currency asset revaluations).