RIGA - Latvia's insurance market is small and has a small number of active participants, which could make it an alluring investment for international players, a top insurer was quoted as saying.
Andrew Kirkland, head of Royal & SunAlliance, an indirect owner of the Balta insurance company, told the Lietiska Diena business paper that the Latvian insurance market was "comparatively small" but would grow 25 - 30 percent over upcoming years.
"The market is rather concentrated, and the number of players is small. The market share of the four largest players is 60 percent. It is an attractive moment for some potential newcomers," Kirkland said.
He said the insurance market in absolute figures exceeds 250 million lats (355.7 million euros) and accounts for 1.7 percent of GDP. (In Lithuania the market comprises 1.4 percent of GDP.)
These figures are relatively low in comparison with the countries of Western Europe, where the insurance market share of GDP is considerably higher and comprises 3 - 4 percent, Kirkland explained.
"The conclusion must be drawn that Latvians and Lithuanians have not insured the basics," he said.
He predicted that the Latvian insurance market growth would unlikely exceed 50 percent, as has been the case in recent years.
"We will expand our product range in these areas. That is why we are developing new products in the area of accident insurance," Kirkland said of Balta insurance.
Kirkland said the presence of new companies on the market would attract more attention from consumers and help the sector develop.
"We are able to work in markets with a large number of players, therefore we are not worried about new players coming," he said.
Currently there are 11 non-life insurers and eight life insurers operating in Latvia.
According to Latvian Insurers Association data, insurance companies subscribed 269.3 million lats in premiums in the first 10 months of 2007, which is 61 percent more than in the same period in 2006. Insurers paid 109.1 million lats in claims, up 39 percent year-on-year.