Market Guide: Life Insurance and Pensions in Bulgaria 2006

This report is most appropriate for companies looking for an overview of the life insurance and pensions markets in order to assess the level of market opportunity (using our market data and forecasts), regulatory barriers and opportunities, and level of competition in the market. For more detailed market data please refer to Datamonitor's European Life and Pensions Interactive Database 2006.



Report Highlights
The Bulgarian life and pensions market expanded by a compound annual rate of 9.9% between 2002 and 2006 Life insurance dominates the Bulgarian life and pensions market, accounting for almost 90% of total premium income in 2006 The Bulgarian market will be shaped by its 2007 accession to the EU


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Overview 1
Catalyst 1
Summary 1
Executive Summary 2
Following compound annual growth of 9.9% in the last five years, between 2006 and 2010, growth in the Bulgarian life and pensions market is set to increase to 23.3% 2
The Bulgarian life and pensions market expanded by a compound annual rate of 9.9% between 2002 and 2006 2
Life insurance will continue to dominate the market 2
The Bulgarian market will be shaped by its 2007 accession to the EU 2
The market is led by foreign subsidiaries 2
4 out of 5 life insurance market leaders in Bulgaria are subsidiaries of foreign companies 3
Table of figures 5
Table of tables 6
MARKET OVERVIEW 7
The Bulgarian life and pensions market expanded by a compound annual rate of 9.9% between 2002 and 2006 7
The Bulgarian life and pensions market experienced compound annual growth of 9.9% between 2002 and 2006 7
After a sharp fall in 2003, the proportion of premium income from non-unit-linked policies has been increasing steadily 9
MARKET FORECASTS 11
Although pensions looks set to grow marginally faster in the next 5 years, life insurance will continue to dominate the market 11
Over the next 5 years, premium income is set to grow at a compound annual rate of 23.3% 11
MARKET REGULATION 13
The Bulgarian market will be shaped by its 2007 accession to the EU 13
The Bulgarian National Bank has little impact on the life insurance and pensions sector 13
The National Social Security Institute has ultimate control over Bulgarian pensions regulation 13
The Financial Supervision Commission supervises all non-banking financial institutions in Bulgaria 13
Bulgaria is shaping its policies towards the EU standard 14
Bulgaria is attempting to standardize its pensions system but it retains differences to other countries 14
Bulgaria is adopting EU pensions directives where possible 15
Bulgaria recently developed a new Social Insurance Code 15
Recent amendments to the Social Insurance Code have been made to align Bulgaria's insurance market with the EU 15
Bulgaria has joined the European Insurance Federation 16
Proposed anti-money laundering legislation is being considered in the Bulgarian Assembly 16
Bulgaria plans to fully adopt all EU legislation by December 2007 16
COMPETITIVE MARKET STRUCTURE 17
The market is led by foreign subsidiaries 17
The total Bulgarian insurance market is dominated by foreign providers 17
The top 5 life and pensions insurers control over three-quarters of the market by gross premium income 18
MARKET LEADERS 20
4 out of 5 life insurance market leaders in Bulgaria are subsidiaries of foreign companies 20
DZI is the life insurance market leader based on 2006 premium income 20
Allianz is a close competitor of DZI 20
Generali Bulgaria is the third largest life insurance player in Bulgaria 20
AIG Life Bulgaria ranks fourth among life insurance companies 21
UNIQA Life Bulgaria rounds out the top 5 life insurers 21
APPENDIX 22
Definitions 22
Capital redemption policy / bond 22
Composite insurer 22
Defined contribution pension scheme 22
Defined benefits pension scheme 22
Group policy 22
Individual pension scheme 22
Individual policy 22
Life assurance 22
Occupational pension scheme 23
Pension insurance policy 23
Premium income 23
Regular premium 23
Single premium 23
Technical provisions 23
Traditional insurance 23
Unit-linked insurance 23
Further reading 23
Interactive Databases 23
Reports and Briefs 24
Ask the analyst 25
Datamonitor consulting 25
Disclaimer 25

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Table 1: Life and pensions insurance premium income, segmented by product, EURm, 2002-2006 8
Table 2: Life and pensions insurance premium income, segmented by product, in percentages, 2002-2006 8
Table 3: Life and pensions insurance premium income, segmented by investment risk, EURm, 2001-2005 9
Table 4: Life and pensions insurance premium income, segmented by investment risk, in percentages 10
Table 5: Life and pensions insurance premium income, segmented by product, EURm, 2006-2010 11
Table 6: Life and pensions insurance premium income, segmented by product, in percentages, 2006-2010 12
Table 7: Number of life insurance providers segmented by type, as at Dec 2005 17
Table 8: Top 5 life and pensions insurers by premium income, as at Dec 2005 19


Figure 1: Life premiums accounted for almost 90% of total premium income in 2006 7
Figure 2: In the last 5 years, growth in premium income from unit-linked insurance has been quadruple that of non-unit linked growth 9
Figure 3: Life premiums will continue to account for around 90% of premium income up till 2010 11
Figure 4: Foreign subsidiaries accounted for two thirds of the market in 2005 17
Figure 5: DZI leads the Bulgarian life and pensions market 18

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