2020 Cyprus Country Report

Insurance
Sector Profile
MITIGATING
RISK
The Cyprus insurance sector remains strong and resilient with
companies registering another year of growth in 2019. The highly
developed sector has been on an upward trajectory for three years
expanding its range of services and products, but now faces new
challenges and opportunities as a result of the coronavirus pandemic.
The Cyprus insurance industry has
shown strong growth over the last
few years with revenues surpassing
even pre-banking crisis levels. 2019
was no different in this respect, with
companies posting healthy figures
across all insurance classes, highlighting
consistent growth in the sector.
The insurance industry, which is one of the
largest institutional investors in Cyprus managing
assets well over €2.5 billion, has successfully
tackled challenges and expanded its services and
product offering, while adapting to a new reality
of digitalisation and the ever-increasing burden
of regulation.
Cyprus’ economy is predicted to shrink in
2020 due to the coronavirus pandemic, with the
hit bearing some resemblance to the 2013 Cyprus
banking crisis, throughout which the local in-
surance sector remained remarkably resilient.
However, a worst case scenario could potentially
have serious repercussions for insurance companies.
The coronavirus is not expected to have a
serious impact on insurance undertakings from
a claims perspective, as most products usually
exclude pandemics and public health threats
from insurance coverage. However, companies in
France and the UK, for example, are now working
with governments to explore solutions for providing
at least some cover for exceptional events such
as the Covid-19 pandemic.
Although the domestic insurance market
in Cyprus is small and has faced challenges,
the sector is highly developed and has a proven
ability to overcome external shocks and quickly
adapt to new market realities. As a jurisdiction,
Cyprus continues to offer international insurance
firms many opportunities as a cost-effective
KEY
contacts
Government:
Ministry of Finance
www.mof.gov.cy
Regulator:
Ministry of Finance
Insurance Companies Control
Service (ICCS) - Supervisor
www.mof.gov.cy
Industry Association:
Insurance Association
of Cyprus (IAC)
www.iac.org.cy
98 Country Report CYPRUS 2020