Euroins will ex­pand fur­ther in SEE

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EIG op­er­ates on sev­eral mar­kets in South­east Europe (SEE). What is the devel­op­ment po­ten­tial of those mar­kets? What are the mar­ket op­por­tu­ni­ties and chal­lenges faced by EIG on the SEE in­sur­ance mar­kets?

We see very good op­por­tu­ni­ties for growth. The SEE coun­tries are still with low pen­e­tra­tion on al­most all in­sur­ance seg­ments. The de­mand for our ser­vices has been grow­ing, driven by the pick-up in the re­gional econ­omy. EIG reg­is­tered a dou­ble-digit growth in pre­mium in­come for 2015 and is ex­cel­lently po­si­tioned to take ad­van­tage of the longterm growth op­por­tu­ni­ties in a re­gion with over 100 mil­lion peo­ple. Cer­tainly, the SEE in­sur­ance mar­kets are at their early stage of devel­op­ment and are still ex­tremely pricedriven. The dom­i­nat­ing lines of busi­ness in the re­gion are the motor seg­ments and es­pe­cially the oblig­a­tory motor third party li­a­bil­ity in­sur­ance (MTPL). This brings some risks to the out­look of the mar­ket. Nev­er­the­less, we ex­pect cus­tomers to be­come more de­mand­ing on their choice of in­sur­ers and pre­dict sus­tain­able growth in Euroins' pre­mium in­come in the com­ing years.

EIG has been ex­pand­ing ag­gres­sively in SEE over the past few years. What are the re­sults of this ex­pan­sion strat­egy so far and how do you plan to de­velop it in the near to medium term?

Our main goal is to make Euroins the lead­ing in­de­pen­dent in­sur­ance player in its core mar­kets in SEE. In the last three years, the com­pany pur­chased the busi­ness of Ger­many-based TALANX Group in Bulgaria and Ukraine (HDI Zas­tra­ho­vane and HDI Strakhu­van­nya), the busi­nesses of QBE in Bulgaria and Ro­ma­nia and In­ter­amer­i­can in Bulgaria. EIG is cur­rently reap­ing the ben­e­fits of these ac­qui­si­tions through port­fo­lio di­ver­si­fi­ca­tion and shared best prac­tices. We cover now all in­sur­ance seg­ments - gen­eral, life and health. Our mar­ket share in Ro­ma­nia is al­most 15%, in Bulgaria – about 7%, and in Mace­do­nia – 9%. We are look­ing to make more ac­qui­si­tions, which are part our way of live. Along with strength­en­ing the group's po­si­tion on the in­sur­ance mar­ket in SEE via ac­qui­si­tions, we have also been grow­ing at a fast pace or­gan­i­cally.

What are the com­pet­i­tive ad­van­tages of EIG's strat­egy for ex­pan­sion in SEE?

While large fi­nan­cial groups have been with­draw­ing from SEE for the last cou­ple of years, Euroins has been go­ing against the stream and has been broad­en­ing its net­work. We are an ex­am­ple for an ex­pand­ing busi­ness that grows much more rapidly than the av­er­age GDP growth of the re­gion and this growth is be­ing de­rived from im­mense man­age­rial and or­ga­ni­za­tional ef­forts. The ex­pan­sion helped us di­ver­sify and im­prove the qual­ity of our in­sur­ance port­fo­lio in or­der to in­crease the share of the non-motor seg­ments and achieve a more pre­cise and de­tailed seg­men­ta­tion. Last but not least, the com­pany is head­quar­tered in Sofia, Bulgaria. With its stable econ­omy, trans­par­ent ad­min­is­tra­tive pro­ce­dures, busi­ness-friendly en­vi­ron­ment, low cost for do­ing busi­ness, low tax base and tal­ented em­ploy­ees, Bulgaria is a per­fect hub for a re­gional ex­pan­sion.

How does EIG adapt to the Sol­vency II rules? What is the im­pact of the new reg­u­la­tions on EIG's busi­ness model?

The com­plex Sol­vency II sys­tem was suc­cess­fully em­bed­ded in EIG. We took steps to com­ply with the new rules in ad­vance in 2014-2015 when we raised around 120 mil­lion euro. We used the funds to sup­port EIG's sub­sidiaries and fi­nance the re­gional ex­pan­sion of the group. The present cap­i­tal level of EIG is ad­e­quately above the risk level as­sumed by the group and thereby pro­vides for strong fi­nan­cial and sol­vency po­si­tions of our busi­ness.

Kiril Boshov, CEO, Euroins In­sur­ance Group

Bulgaria-based Euroins In­sur­ance Group (EIG) is one of the largest in­de­pen­dent groups op­er­at­ing on the in­sur­ance mar­kets in Cen­tral, East and South­east Europe. EIG has more than 7% mar­ket share in the re­gion, over 2 mil­lion clients, 1,600 em­ploy­ees and...

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