Furthermore, measures taken by the National Bank of Serbia are making a positive impact on growth and the regularity of business. With respect to the insurance sector, the Serbian market doesn’t differ much from that in other European countries. We have a wide range of types of insurance and with the introduction of the Solvency II regulation which defines capital adequacy we are further approaching the European market.
How do you explain the fact that the total amount of premium insurance in Serbia was 2% of GDP last year compared to the EU’s which was three times higher, and the fact that life insurance was below 25% of this compared to 60% in the EU?
– It is a fact that the insurance sector in our country is still underdeveloped, even if there are signs of double-digit growth each year. The nominal increase of total premium is 10.1% suggesting a continuing positive trend in market development. However, the amount of premium per capita is still very low in Serbia: last year it was 108 dollars, while in the European countries it was 2,400 dollars. With further development of our country and its living standards, the insurance sector will also prosper. We need to spread the culture of insurance and advise citizens to secure what is most important to them ˗ life, health and property ˗ by suitable insurance solutions.
Even so, Generali achieved good results in 2016, primarily thanks to insurance that companies provide for their workers. Doesn’t this mean that insurance was seen as an investment rather than an expense?
– Of course, we achieved good results in 2016. We demonstrated once again our ability to create new value for our clients, shareholders and staff. Our good results placed us among the best companies in the Central East European region and on the insurance market in Serbia. With 22.2% of market share, we secured the status of the second largest insurance company on the domestic market. In the life insurance sector we proved to be market leader in the last couple of years, by increasing our market share to 30.1% in 2016. We are also the leader in health insurance with a 43.8% market share. It is also a fact that employers increasingly recognize health and life insurance as a good benefit for their employees, and that this affects the development of this type of insurance. People who agree to take such insurance are well informed that it is a good investment and a responsible attitude. On the other hand, people still often come to say that the insurance is expensive, even if they can secure their house or flat for 40 euros per year, which is not expensive, as I am sure you will agree. This is especially obvious when you know that this can protect property up to a value of 60,000 euros.
What could be added to the Government’s reform agenda to promote the insurance sector and the overall economic development of Serbia?
– What we should all do is to spread the culture of insurance. The Government should be very active in the process, explaining to citizens that they have to take the initiative to protect their property now, rather than to expect government support after a disaster. Even more prosperous countries cannot constantly support their citizens. This is why there is insurance to cover damage. The possibility of introducing mandatory insurance of property for basic risks should also be considered. When people have been used to having insurance for several years, they will continue paying for it of their own free will. Tax incentives for people who pay life and health insurance may further influence development of the sector in an important way.
Generali is a company with a long history of business in Serbia. What is your experience with the investment and business climate in Serbia?
– Generali Serbia is a domestic company belonging to an international group. We started as a greenfield investment and became the second largest insurance company in Serbia with around 2,000 staff. From the insurance standpoint, our results prove that the business climate in Serbia, though highly competitive, is suitable for development and obtaining good results.
Amendments to the Insurance Law have allowed the introduction of new products to the Serbian market. However, for insurance and other sectors to see a better potential for development, amendment of other regulations in the field of expanding the “free space” for investment and management is needed. More efforts should be put into the transparency of business and healthy market competition. This will improve customer satisfaction – which is the focus of our company.