BMI View: Insurance market growth has been strongly supported by motor insurance premiums , although property insurance will become a bigger contributor over time . Poor equity market trends have caused downward s pressure on life premiums. In spite of steady growth over the medium term, the market will remain one of the smallest in the region. Rising premiums will be supported by economic growth and investment, particularly with the interest of foreign multinational providers.
|BMI/Bank of Lithuania|
|Gross life premiums written, EURmn||181.3||215.0||236.0||244.1||253.1||262.9||273.0||283.6|
|Gross life premiums written, EUR, % y-o-y||8.9||18.6||9.7||3.4||3.7||3.9||3.9||3.9|
|Gross life premiums written, USDmn||240.7||285.3||261.7||261.1||265.7||268.1||273.0||283.6|
|Gross life premiums written, USD, % y-o-y||12.6||18.5||-8.3||-0.2||1.8||0.9||1.8||3.9|
|Gross non-life premiums written, EURmn||382.1||385.8||409.1||423.5||430.7||439.9||450.1||460.9|
|Gross non-life premiums written, EUR, % y-o-y||8.7||1.0||6.0||3.5||1.7||2.1||2.3||2.4|
|Gross non-life premiums written, USDmn||507.4||511.9||453.8||453.1||452.2||448.7||450.1||460.9|
|Gross non-life premiums written, USD, % y-o-y||12.3||0.9||-11.4||-0.1||-0.2||-0.8||0.3||2.4|
Key Updates And Forecasts
Lithuania's economic backdrop is modestly supportive. Our Country Risk team forecast that real GDP growth will register 2.9% in 2016 and 3.1% in 2017, up from just 1.6% in 2015, but considerably below the 3.6% averaged between 2010 and 2014. Having downgraded our forecasts last quarter, we have largely retained our projections this quarter. We anticipate that gross premiums will rise 3.4% in 2016 and 3.7% in 2017 in EUR terms. Unfavourable movements in the EUR/USD rate translate into a 0.2% fall in premiums in USD terms in 2016 and a 1.8% rise in 2017.
We largely retain our core non-life forecasts from last quarter. Gross premiums are on course to grow 3.5% in 2016 and 1.7% in 2017, in EUR terms. In dollar terms, the performance is weaker, owing to continued depreciation of the euro, with a contraction of 0.1% in the USD value of gross premiums written in 2016, followed by a 0.2% fall in 2017.
Accounting for 21.5% of premiums written in the non-life segment in 2016, property insurance is the second largest sub-sector. Due to currency market effects, we forecast premiums will fall by 1.2% in USD terms in 2016 to USD97.6mn, while in local currency terms premiums will increase by 2.4% to EUR91.2mn. In a competitive market, product distribution/innovation by the leading property insurers and wider economic growth will be the main source of growth. Over the medium term, prospects are also broadly favourable. We think that premiums will rise by around 4-5% annually in local currency terms. Additional drivers of growth will include the development of new products and business with first-time users.
The Lithuania Insurance Report has been researched at source and features BMI Research's independent assessment and forecasts for the insurance sector. It examines industry developments, key growth drivers and risk management projections, including the macroeconomic situation, government policy, regulatory environment and the level of development and potential for growth, broken down by line. Leading insurers are profiled, covering premiums, products and services and competitive positioning.
BMI's Lithuania Insurance Report provides professionals, consultancies, government departments, regulatory bodies and researchers with independent forecasts and regional competitive intelligence on the Lithuanian insurance industry.
- Benchmark BMI's independent insurance industry forecasts for Lithuania to test other views - a key input for successful budgeting and strategic business planning in Lithuania's insurance market.
- Target business opportunities and risks in Lithuania through our reviews of latest industry trends, regulatory changes and major deals, investments and macroeconomic developments.
- Exploit latest competitive intelligence on your competitors, partners and clients via our Company Profiles (inc. SWOTs, KPIs and latest activity).
BMI Industry View
Summary of BMI’s key industry forecasts and views, covering the Life and Non-Life segments, the evolving competitive landscape and business operational risks.
Industry SWOT Analysis
Analysis of the major Strengths, Weaknesses, Opportunities and Threats within the insurance sector and within the broader political, economic and business environment.
BMI Industry Forecasts
Historic data series (2005-2014) and forecasts to end-2019 for key industry indicators, supported by explicit assumptions, plus analysis of key risks to the main forecasts. Indicators include:
- Life/non-life Premiums: Total premium growth (USDmn), premium growth (% y-o-y), penetration (% of GDP), density (USD per capita) for Life and Non-Life sectors, claims reinsurance, and assets and liabilities.
- Non-life subsectors: Data on gross written premiums for all major Non-Life segments (motor, transport, property, personal accident, health, general liability and credit financial).
BMI’s Insurance Risk Reward Index
BMI’s Risk Reward Indices provide investors (Life and Non-Life) looking for opportunities in the region with a clear country-comparative assessment of a market’s risks and potential rewards. Each of the country markets are scored using a sophisticated model that includes more than 40 industry, economic and demographic data points to provide an indices of highest to lowest appeal to investors, with each position explained.
Examines the competitive positioning and short- to medium-term business strategies of key industry players. The latest financial and operating statistics and key company developments are also incorporated within the company profiles, enabling a full evaluation of recent company performance and future growth prospects.
Growth Drivers & Risk Management Projections
Key data and forecasts to end-2019 focusing on the growth drivers and downside risks to specific insurance lines including:
- Population: Male/female, by age group, active/pensionable/youth population % of total, urban/rural population % of total.
- Freight: Tonnage – air freight, rail freight, road freight, inland waterway.
- Motor: Fleet size by type of vehicle % change y-o-y.
- Epidemiology: Disease Adjusted Life Years and private health expenditure.
Market Overview & Rankings
Illustration of the insurance industry via rankings tables comparing gross written premiums by company (USDmn) and market share (%) for the top 20 players in both Life and Non-Life. This chapter also includes in-depth regional analysis of the market position, business strategies and investment potential of the leading insurance companies.
The insurance Reports draw on an extensive network of primary sources, such as multilateral organisations, government departments, industry associations, chambers and company reports.
*Company profiles are not available for every country. Those reports instead contain information on the current activities of prominent companies operating in the market.