The Remaining Markets segment includes Albania, Bosnia-Herzegovina, Bulgaria, Croatia, Estonia, Georgia, Germany, Hungary, Latvia, Liechtenstein, Lithuania, Macedonia, Serbia, Turkey and Ukraine. The Remaining Markets segment generated 10.1% of Group premiums.

The Montenegro and Belarus markets were not included in the VIG consolidated financial statements.


The ratio of non-life insurance to total premium volume is around 90% in Albania, with approximately 60% due to mandatory insurance. In terms of local currency, premium volume in the overall market rose by 7.0% year-on-year in 2012, with the non-life segment recording an increase of 10.6%. After showing a burst of growth in 2011, life insurance suffered another decline in 2012. The decrease is due to the challenging economic conditions, which are causing both private households and companies to save.

Vienna Insurance Group is represented by the non-life insurance companies Sigma, Interalbanian and Intersig in Albania. Sigma also has a branch in Kosovo. VIG's market share increased in 2012 over the previous year to a current level of 29.7%, putting it into the lead in the non-life insurance segment. It holds second place in the overall market.


The market data here illustrate the potential that exists in the insurance market in Bosnia-Herzegovina. The insurance density in Bosnia-Herzegovina (annual per capita premiums) was around EUR 64 in 2011, compared to around EUR 76 in Serbia and more than EUR 2,500 in the EU-15 countries. The overall market recorded an increase of 3.5% in terms of local currency in 2012.

VIG has been represented by Jahorina in Bosnia-Herzegovina since 2011. The company was established in 1992 as a non-life insurer, and has now also been offering life insurance for a few years. The focus of its activities is, however, on the distribution of motor vehicle insurance. Jahorina is the market leader in Republika Srpska, and seventh in the overall market.


Life insurance still represents a very small share of total premium volume in the Bulgarian insurance market, which is dominated by the motor vehicle lines of business. It is precisely this segment, however, that is being negatively affected by competitive pressure in the motor vehicle liability line of business and declining new vehicle registrations in the motor vehicle own-damage line of business. The overall market experienced slightly negative growth of -1.1% in terms of local currency in the 1st-3rd quarter of 2012.

Vienna Insurance Group is represented by Bulstrad Life and Bulstrad Non-life in Bulgaria. Bulgarski Imoti was merged with Bulstrad Non-life to form a powerful company in 2012. VIG holds second place in the overall market with a market share of 13.8%, and is the leader in non-life insurance.


Even in the fifth year of the financial market crisis, business development in the German insurance market continued to show stable growth in 2012. Property and casualty premiums are forecast to rise by 3.7%, the strongest growth recorded since 1994. Due to moderate growth in regular premium products and a slight increase in the single-premium business, life insurance is expected to increase by approximately 1%.

VIG operates two companies in Germany, InterRisk Non-life and InterRisk Life. The InterRisk companies distribute exclusively through brokers. InterRisk Non-life specialises in casualty and third-party liability insurance, as well as selected property insurance products. InterRisk Life focuses on retirement provision and occupational disability solutions, as well as protection for surviving dependants. The VIG companies operate successfully in the German market as profitable niche providers.

Estonia, Latvia and Lithuania

Growth in the Latvian insurance market was particularly strong in the areas of health insurance and life insurance with guaranteed interest in 2012. Estonia also saw growth stabilise in the life insurance segment compared to 2011. In Lithuania, growth was recorded in life insurance products with regular premium payments.

VIG is represented in the Baltic States by Compensa Life and by branches of the Polish Compensa Non-life in Latvia and Lithuania. In the life insurance segment, VIG is fourth in the market in Estonia. In Latvia, the market share in this segment rose to 11.8% in 2012, compared to 9.4% in the previous year. In Lithuania, VIG ranks sixth in life insurance and seventh in the non-life segment.


Development of the Georgian insurance market was dominated by an expansion of the government health insurance programme and the accompanying significant increase in this line of business. Health insurance represents more than 70% of total premium volume. In total, premiums written rose by 74.9% in terms of local currency in the 1st-3rd quarter of 2012.

The two Georgian VIG companies GPIH and IRAO have a market share of 23.3%. Together, they hold second place in the market, following the merger of two competitors in April 2012. Both GPIH and IRAO focus on the distribution of health insurance products and are benefiting from the developments taking place in the market.


The ongoing difficult economic situation led to a 1.2% year-on-year decrease in total premiums in Croatia in 2012, based on local currency. Competitive pressures and a decrease in new registrations caused a decline in motor vehicle insurance. Non-life insurance fell by 2.0% in total, while life insurance recorded an increase of 1.2%.

VIG is currently represented by three Group companies in Croatia: Kvarner, Helios and Erste Osiguranje. There are plans, however, to merge Kvarner and Helios. VIG holds a total market share of 7.8%, putting it in fourth place in the overall market. It holds second place in the life insurance market with a 16.3% share of total premium volume.


The companies based in Liechtenstein offer insurance solutions aimed at the international market, with a particular focus on the area of index-linked life insurance. Unique access to both the European Economic Area and the Swiss market is a key benefit of the location. The overall market recorded premium income at the same level as the previous year in 2012.

VIG is represented by Vienna-Life in Liechtenstein. Vienna-Life operates exclusively in the life insurance segment and concentrates predominantly on unit-linked and index-linked life insurance.


Even though the Macedonian insurance market is dominated by non-life insurance, the life insurance segment is recording double-digit growth rates. In terms of local currency, life insurance grew by 20.6% year-on-year in the 1st-3rd quarter of 2012. The increase recorded in the non-life segment was considerably smaller, at 1.4%.

VIG is currently represented in Macedonia by Winner Non-life and Winner Life, and holds fourth place in the market with a market share of 9.9%. The acquisition of QBE Makedonija, which is subject to official approval, will put VIG in first place in the Macedonian insurance market. QBE Makedonija has a broad product portfolio, with a focus on motor vehicle and casualty insurance, and a strong nationwide sales network.


The Serbian insurance market showed solid premium growth of 6.7% in terms of local currency in the 1st-3rd quarter of 2012. The non-life segment, which is much greater than the life segment, recorded an increase of 4.4%. Sales of life insurance products, however, showed much stronger growth of 18.9%.

Wiener Städtische Osiguranje, which represents VIG in Serbia, holds fourth place in the market with a market share of 8.7%. The company is second in the life insurance segment, where it generated 22.8% of total premium income in the market.


The Turkish insurance market continued to show double-digit growth in spite of the slowdown in economic growth. In terms of local currency, total premium volume rose 15.5% year-on-year in 2012. In addition, the market has changed since the 2nd half of 2012 from price competition to pricing that is more risk based.

VIG's Group company Ray Sigorta holds 14th position in the overall market, with a market share of 1.5%. The company sells non-life insurance, with a focus on motor vehicle insurance products.


The top ten insurers in the Ukraine only generate approximately 30% of total premium volume. The market is highly fragmented, with 442 insurance companies registered at the beginning of 2012. As in many other countries in the Remaining Markets segment, the Ukrainian market is dominated by the non-life insurance business, which generates approximately 95% of total premium volume. In terms of local currency, total premium income decreased 3.8% year-on-year in the 1st-3rd quarter of 2012.

VIG is represented by four insurance companies in the Ukraine. These include the three non-life insurers UIG, Kniazha and Globus, and the life insurance company Jupiter. VIG increased its total market share to 3.6% in the 1st-3rd quarter of 2012, and holds fifth place in the market.


In terms of local currency, the Hungarian insurance market suffered a year-on-year decrease of 6.5% in 2012. In addition, a new tax was introduced on insurance premiums in January 2013. The tax consists of a 15% tax on gross premiums for motor vehicle own-damage insurance, and a 10% tax on gross premiums for property and casualty insurance. The new tax is an addition to the existing tax on premiums for motor vehicle liability insurance, which continues to remain in effect.

VIG is represented by Union Biztosító and Erste Biztosító in Hungary. These two companies performed very well, in spite of the difficult conditions, and hold eighth place in the market in 2012 with a market share of 5.5%.

This information
was audited by PWC
GmbH, Vienna on
March 12, 2013.