financial stability report - Banka Qendrore e Republikës së Kosovës

Number 3
Financial Stability Report
capacity of the insurances companies to withstand the potential losses, was 83.7 percent,
compared with 81.1 percent in June 2011. 15 This ratio is higher in the first half of 2012 due
to a faster growth rate of the capital, compared with the growth rate of the technical
reserves.
While the balance sheet of the insurance companies in the first half of 2012 indicates an
expansion in the insurance industry activity, the analysis of the revenues and expenditures
indicates a decline in performance of this industry. This is because the net profit of the
insurance companies, which represents one the main performance indicators, recorded a
value of euro 0.6 million, which is around half of the value of the last year’s net profit,
registered in June 2011.
The lower net profit in the first
half of 2012, also reflected in the
deterioration of the two other
performance indicators, namely,
Return on Average Assets (ROAA)
and Return on Average Equity
(ROAE). In June 2012, ROAA was
0.6 percent, compared with the 1.2
percent in June 2011. The ROAE
indicator followed a similar trend,
declining to 1.4 percent, compared
with the 3 percent in June 2011. 16
45
38.0%
40%
35.3% 35.2%
40
35%
33.1
34.8
35
39.6
38.1
30%
16 The ROAA and ROAE indicators are annualised.
30
25
24.2%
25%
20%
20
15
13.2 13.4
13.9 15%
10
8.0
10%
5
5%
0
0%
June 2009 June 2010 June 2011 June 2012
Received premiums Paid claims Claims/primiums (right axis)
Source: CBK (2012)
Figure 65. Structure of received primiums of the
insurance companies
29.8%
13.3%
56.9%
TPL polocies Border policies Other
15 The technical reserves are necessary to ensure a permanent fulfilment of the liabilities of the insurance companies against the policy holders, until the
expiration of the insurance agreement.
In June 2012, the number of
policies sold by insurance companies operating in Kosovo reached at 304.1 thousand, which
represents an annual growth rate of 24.8 percent. The value of the premiums received
during this period rose by 4 percent, reaching a value of euro 39.6 million. The value of the
claims paid followed a similar
pattern during the first half of
2012, reaching a value of euro 13.9
million and an annual growth rate
of 3.6 percent. An approximately
similar growth rate of the
premiums received, as well as of
the growth rate of the claims paid,
resulted into the same ratio of the
premiums received and claims paid
with the ratio of the last year, i.e.
35.2 percent (Figure 64).
Figure 64. Received primiums and paid claims, in
millions of euro
Source: CBK (2012)
Within the premiums received,
only about 0.8 percent are generated from the life insurance premiums, whereas the rest
are non-life insurance premiums.
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