PROFITS OF ARMENIAN INSURANCE COMPANIES GROW 49.6% IN 2004

YEREVAN, APRIL 1, NOYAN TAPAN. Some activization has been registered
in the insurance sphere of the country in 2004 as a result of the
application of the new Law on Insurance. Head of the Department of
Insurance of the RA Ministry of Finance and Economy Ashot Gomtsian
stated at the April 1 press conference that only last year, another 4
companies received licences to carry out insurance activities. As of
January 1, 2005, there were 26 licenced insurance companies in
Armenia, 20 of which operated in accordance with their regulations.

According to A. Gomtsian, the overall authorized capital of the
companies grew 33.4% in 2004 and made about 2 bln 398.8 mln drams
(about 4.5 mln USD) as of January 1, 2005. In the year under review,
the companies’ own capital increased 34.5% to about 2 bln 768.6 mln
drams, while the assets – by 48.8% to about 6 bln 304.8 mln drams. The
insurance reserves and insurance payments grew 48.9% to 1.9 bln drams
and 47.1% to 3.9 bln drams respectively. Insurance compensations
decreased 2.2% to 444.5 mln drams. The profit of the insurance
companies grew 49.6% to 178 mln 473 thousand drams. According to the
department head, with the aim of protecting the interests of the
insured, stricter normatives for the operation of the companies were
established by the new law, in particular, the minimum amount of the
authorized capital was increased. It will make 100 mln drams in 2005,
200 mln drams in 2006, and 500 mln drams in 2008. The speaker
underlined that the introduction of various types of compalsory
insurance is a top priority for developing the sphere. At present the
companies mainly insure against accidents, as well as cargo, property,
plane risks, whereas life insurance is available only at 3-4
companies.