BAKU, Azerbaijan, February 27. Moody's, an international rating agency, analyzed the outcomes and chances for the development of reinsurance business in the CIS nations, including Azerbaijan, in the group of countries with a good basis and prospects for this, Trend reports via Moody's.
"The four major insurers from Uzbekistan, Kazakhstan, Azerbaijan, and Georgia formed a reinsurance group (represented by a single business) at the end of 2023. Marsh & McLennan, a US insurance broker, intends to expand reinsurance capacity in the CIS space. Participants will get access to a broad client base, grow their position in the region, and provide reinsurance cover for large-scale projects in Central Asia and the Caucasus," Moody's notes.
Experts at this respectable agency observe that insurers in Kazakhstan, Uzbekistan, and Azerbaijan (Azerbaijan is rated Ba1, outlook stable) have stronger access to international markets than their counterparts in other CIS nations.
"Kazakhstani, Uzbek, and Azerbaijani insurers have greater capital bases and stronger credit ratings. These are crucial conditions for insurance companies that want to engage in the reinsurance market," Moody's emphasizes.
This rating agency sees the appearance of opportunities when Russian reinsurance companies exit the market owing to international sanctions as a favorable prerequisite for these countries to enter the global reinsurance market.
"According to our estimations, Russian players used to generate more than $400 million in international reinsurance premiums each year. International reinsurance brokers are now focusing on other CIS countries to fill this vacuum, with enterprises in Uzbekistan (stable Ba3) and Kazakhstan (positive Ba2) gaining the most," the research noted.
Overall, Moody's feels that, while CIS insurance markets have strong long-term growth potential and have recovered fast from the coronavirus outbreak, structural problems remain.
"However, we anticipate that these markets will develop gradually as the legal framework, insurance culture, and income levels in these nations change," Moody's forecasts.
Stay up-to-date with more news on Trend News Agency's WhatsApp channel
