Agency for Development of Insurance Market to be established

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July 11, 2019

Agency for Development of Insurance Market to be established

On July 10, President Shavkat Mirziyoyev held a meeting on the issues of development of the insurance market.Insurance services are one of the means of protecting economy from all sorts of financial risks. However, the place of such services in domestic financial market is still insignificant.
Over the past six months of 2019, the volume of insurance premiums collected by specialized organizations increased by 1.5 times compared to the same period of 2018. 50 thousand soums of insurance premiums are accounted for per capita per person.
The share of this sector in gross domestic product of Uzbekistan reached only 0.4 percent. For comparison, this figure is 11 percent in South Korea, 6 percent in Germany, 1.5 percent in Russia.
Low attractiveness of insurance services is one of the reasons for problem in this sphere. Thus, if over the past six months, the insurance premiums are collected for a total of 887 billion UZS, the insurance claims paid to customers for the same period amounted to only 11 percent of this amount. In the world, this figure is on average 50-60 percent.
Issues of fundamental reformation of the State Inspectorate for Insurance Supervision under the Ministry of Finance were discussed at the meeting on the basis of modern requirements.
“The sphere needs not a control structure, but one that will introduce advanced modern standards, create a really competitive environment for all participants, develop the insurance market”, said Shavkat Mirziyoyev.
It has been offered to liquidate this inspection and organize Agency for Development of Insurance Market. Responsible officials have been instructed to develop a strategy for medium and long-term development of insurance sector, double the volume of insurance premiums per capita, as well as triple the share of the sphere in the country’s GDP until 2022.
The need for enhancing confidence among population and entrepreneurs to insurance was noted. The Ministry of Finance and Antimonopoly Committee have been tasked to reduce time and list of documents for consideration of insurance claims, introduce a fair assessment system of insured event and prompt payment. Instructions have been given to support the investment activities of insurance companies, unification of the base and tax rates of leasing services.
The need for expanding mechanisms for supporting the investment activities of insurance companies was noted. In particular, tasks for stimulating leasing by insurance companies and improving the tax system of leasing operations have been defined.
The importance of insurance coverage of economic sectors was noted. The Ministry of Finance and the Ministry of Investments and Foreign Trade have been instructed to introduce mechanisms of subsidizing a part of export insurance costs for agricultural products.
Specific tasks on ensuring the entry of domestic insurance companies into the international financial market, introduction of advanced systems of corporate governance and obtaining international ratings have been identified.
Special attention has been paid to training modern personnel in insurance, training and advanced training of specialists in prestigious educational institutions and leading companies abroad.
Speaking about introduction of compulsory health insurance system, the Head of the state noted the need for careful preparation for the new system and formation of a minimum social package of medical services.