Insurance market development: focus on medical insurance and e-policy

The Expert Board on Insurance under the Bank of Russia met to discuss important issues of medical insurance development, as well as prospects for insurance agents and brokers to enter into electronic insurance contracts.

Medical insurance companies (MIC) constitute an essential part of obligatory medical insurance (OMI). The Bank of Russia believes that medical insurers should meet high standards of efficiency, as the well-being of Russian citizens depends on the quality of their work. The introduction of insurance principles and a risk component in the Russian OMI practice will not only increase the system’s efficiency, but also have a favourable effect on healthcare overall.

The meeting’s attendees recognised the need to establish both an interdepartmental working group to look into additional requirements, and a procedure for issuing and revoking licences and other aspects of MIC’s operations. Public discussion about updating the system of medical insurance should continue to take place with representatives of the financial market and expert community.

In discussion on e-sales of insurance products, members of the Expert Board noted the importance of removing current legally established restrictions on the activity of insurance agents and brokers.

A ban on the execution of e-sales through insurance intermediaries hampers the potential for developing on-line insurance. Meeting attendees stated that if permitted to operate via the internet – for the most part as aggregators – insurance services would become more affordable for consumers, competition would increase and insurers’ costs would decrease.