From 2008 to 2010 the insurance market of Kazakhstan underwent significant changes that practically altered not only the legislative framework of insurance but also the insurance companies themselves.

During this period the following changes took place:

  1. A number of laws of the Republic of Kazakhstan were issued and came into force;
  2. Some insurance companies were liquidated or had their licences revoked;
  3. A large number of insurance specialists either left the market or moved to other insurance companies.

In view of the above, and because not all legal entities can make timely use of consultations from the Polis Re Insurance Center, we decided to set out some simple tools that will allow you to see an objective picture of the insurance market and learn about the activities of a particular insurance company.

Recommendations

  1. Use official sources of information: the website of the Financial Supervision Agency (AFN) for the insurance sector. General information on the insurance companies operating in Kazakhstan can also be found on the website of the National Bank.
  2. Everything is learned by comparison: a summary table of insurance companies for the current date can also be obtained on that website.
  3. The Polis Re Insurance Center recommends paying attention to the following indicators: “Retained earnings (uncovered loss) of the reporting period” (always look at the trend and the reason); “Insurance premiums”; “Solvency margin ratio Nmp>1”; “Expenses for making insurance payments”; “Assets”.

We hope that the information provided in this section will help you avoid wrong decisions.

For a more in-depth analysis of the insurance market and, accordingly, high-quality placement of your risk, we recommend contacting the specialists of the Polis Re Insurance Center.

What has changed since then

The functions of supervising the insurance market, which were at the time performed by the AFN and the National Bank, are now carried out by the Agency of the Republic of Kazakhstan for Regulation and Development of the Financial Market (ARDFM). Information on licences, as well as regular financial statements of insurance organisations, is published on the regulator’s official resources and on the companies’ own websites. The main principle remains the same: rely on official data, not on advertising materials and hearsay.

How to read the key indicators

Retained earnings (uncovered loss)

This shows whether the company has made a profit or incurred a loss. A single loss-making period is not in itself a verdict: it may be related to a large payment or to the formation of reserves. What matters more is the trend over several periods and the reason – if the loss repeats year after year, it is a signal to study the company more closely.

Insurance premiums

The volume of premiums collected reflects the scale of the business and its market share. It is useful to look at the structure: what share is made up of compulsory lines and what of voluntary ones, and to what extent the company specialises in the class of insurance you need.

Solvency margin ratio

This shows whether the insurer has sufficient own capital relative to the obligations it has assumed. A value above one means the ratio is met; a surplus above the minimum is an additional safety cushion. A decline of the indicator towards the threshold value is a reason to be on guard.

Expenses for making insurance payments

Compare payments with premiums collected. A level of payments that is too low may point to a rigid claims settlement policy, one that is too high and rising – to pressure on financial stability. Assess it in comparison with other companies in the same lines of insurance.

Assets

The size and quality of assets show what the company uses to meet its obligations. Not only the amount matters but also the structure: liquid and reliable instruments are preferable to risky investments.

Qualitative criteria

  • A licence for exactly the class of insurance you need.
  • Reinsurance protection for large risks and the reliability of the reinsurers.
  • Claims settlement practice: deadlines, transparency of document requirements, attitude to disputed cases.
  • A rating from an international or national rating agency and its trend.
  • Clear insurance rules available before the contract is concluded.
  • A branch network and service in the regions where your facilities or employees are located.

Step-by-step selection procedure

  1. Determine which risks need to be insured and what limits are required.
  2. Draw up a list of insurers with a valid licence for the required class.
  3. Compare financial indicators over several reporting periods.
  4. Request commercial proposals and compare not only the price but also the terms: deductible, exclusions, sub-limits for individual risks.
  5. Study the insurance rules and the draft contract before signing.
  6. Clarify the procedure in the event of an insured event and the list of documents for payment.

Typical mistakes

  • Choosing only by the lowest price without comparing the terms of cover.
  • Assessing a company by one indicator or one reporting period.
  • Not reading the exclusions and the deductible terms.
  • Relying on verbal promises that are not set out in the contract.

The list of insurers operating in the market is collected in the insurance companies section, and the meaning of terms can be checked in the glossary. If you need to compare the proposals of several companies for your risk, you can get a consultation from an insurance broker.