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Insurance in Azerbaijan

In our recent past insurance as all economic life was a monopoly of government. It settled the matter itself to insure whom and how, how much and when get insurance premiums. Started liberalization of economy concerned either insurance as a type of business activity. It was allowed to create private insurance companies. In Azerbaijan this process is legally manifested in the Law “About insurance” from January 5, 1993. After passing this Law the process of formation of insurance’s legislative basis was strongly slowed down. Only three years later the other law about insurance of owners’ civil responsibilities of transformation facilities was passed.
Boom, associated with the creation of insurance organizations started later a year, after the law about insurance has been passed. National Bank’s leadership of those times, carrying out uncontrolled and disordered emissions, “pumped” countries economy with in no way uncovered zeros in rated account. Exactly at the beginning of 1994 the situation in finance and credit sphere was not far from catastrophe. Non-cash manat continued losing his ground, after while and country would be able to be in financial collapse. Exactly in this situation were appeared insurance firms like mushrooms after rain which ”insured” credits given by banks. It’s notable that insurance companies with authorized capital “insured” credits with several hundreds of dollars exceeding their own assets more than ten and hundred times. After National Bank’s changing of leadership in 1994 and with beginning to conduct of hard finance and credit policy a lot of insurance companies disappeared, than those, whose credits they insured. Market began to dictate its own rules and now there are 28 active insurance firms existing in Azerbaijan. By refined data, in 2009, insurance companies of Azerbaijan, gathered 163,30 million manats premium which was 7,3 % fewer than in 2008. Payments were increased for 2,2 % and amounted 53,07 million manats. Continue reading

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