Following a break of six years, a new insurance company is being established on the Macedonian life insurance market in which Slovenian owners will invest EUR 4 million. This investment proves that the current ISA management in cooperation with other financial institutions is actively improving the business climate and is therefore creating conditions for investments in the insurance business.
The Insurance Supervision Agency (ISA) issued a work permit to the new insurance company “Prva Život”. This company shall offer life insurance on our insurance market. The founder and sole owner of the newly established life insurance company is the Slovenian insurance holding PRVA GROUP (SKUPINA PRVA, zavararovalniski holding, d.d).
The Slovenian group is a renowned holding that has been managing pension funds in Slovenia, Serbia, Macedonia and Kosovo for two decades. The Group has an insurance company in Slovenia, and their entry into our insurance market is expected to improve competitiveness in the sector and contribute to enriching the offer of life insurance products.
The Slovenian company invested EUR 4 million in the newly established insurance company, which is the amount of the founding capital of “Prva Život”. The funds have been deposited in a special foreign currency account of the central bank.
At the regular session, the Council of Experts of ISA adopted the decision to issue a work permit that allows “Prva Život” to perform insurance operations within the group of life insurance in class 19 – life insurance.
“Prva život” will start working within six months from the day of issuing the work permit, and the company’s headquarters will be in Skopje. Predrag Milosevski has been appointed as an executive member of the Board of Directors.
ISA obliged the company to appoint an authorized actuary within two months of the company’s registration in the Trade Register.
“Prva život” will be the sixth company on the Macedonian life insurance market, where “Croatia insurance – život”, “Triglav život”, “Grawe”, “Winner Life VIG” and “Uniqa Life” are currently operating.
During the first six months, citizens have invested over EUR 14 million in life insurance in the five life insurance companies.
Our insurance market invests in three groups of life insurance products. Investments in insurance with a savings component have the largest share in total life insurance. This product enables the insured entity to receive the invested funds increased with interest after the expiration of the insurance contract. Payments of policyholders who have this type of insurance are invested in bank deposits in government bonds or other risk-free financial instruments.
The official data of the life insurance companies shows that the biggest growth in sales is life insurance that does not have a savings component. In this case, in the event of death for the duration of the contract, the insured amount is paid to a family member or another beneficiary of the insurance. However, if the risk does not occur until the expiration of the insurance contract, all the invested funds are kept by the insurance company that assumed the risk to pay out funds in case of death of the insured person.
Life insurance in which the risk of investing the funds is assumed by the insured entity, is the newest insurance product from the range of life insurance products on our market. This product is popularly known as “Unit linked” insurance. Here, a significant part of the money is invested in investment funds, chosen by the insured entities, whose market prices depend on the movements of regional and global capital markets.