One of the leading reinsurers in the CEE region, VIG Re, has announced expansion plans with gradual growth of its Germany business and a trajectory into new Western European markets.
The firm named France, Belgium, Luxembourg and Switzerland as its next key target markets, but said its entry into these markets would be ‘controlled’.
CEO of Vienna Insurance Group, Elisabeth Stadler, said; “VIG Re has acquired an excellent market reputation of being practical and operating quickly. We will position ourselves in the expanded markets as a niche player for special customer and market segments. These are primarily local and regionally-oriented direct insurers.”
The Prague-headquartered reinsurer already operates in 31 countries and announced a preliminary premium volume of €370 million in 2015.
The group said its preliminary premium volume had shown stable development with significant growth of premiums increases of over 4.4% across most lines of business, despite the firm adhering to a strict underwriting policy to navigate the low-interest environment.
“Due to the since years existing low-interest rate environment, our focus in the life insurance area is on unit-linked and index-linked life insurance and coverage for biometric risks. Unit-linked and index-linked life insurance increased from 25.5 percent to almost 35 percent of total life insurance over the last five years, and represented 41 percent of new business in 2016,” explained Stadler.
The Group CEO boasted above average results for last year’s before tax preliminary profit;”At EUR 406.7 million, we achieved the top end of our target range, thereby far more than doubling our profit (before taxes),” said Stadler.
For a group like Vienna Insurance that’s shown stable growth throughout its primary insurance markets, parallel expansion of its reinsurer, VIG Re, is the logical next step to further diversify earnings and improve the firm’s pricing and product offers.