Health insurance is booming in Latvia

Health insurance is booming in Latvia: it makes up more than a fifth of the market

Health insurance in Latvia during the three quarters of 2022 maintained its leading position as the largest type of insurance with 105 million euros in premiums and a market share of 21.4%, although life insurance has traditionally been the largest type of insurance both in Latvia and in Europe. Life insurance premiums for nine months amounted to 100 million euros, which is 20.5% of the market, according to data collected by the Latvian Insurers Association (LAA).

“The health insurance breakthrough began during the Covid-19 pandemic, which made it especially difficult to obtain publicly funded health care services and stimulated the purchase and widespread use of private health insurance. Not only insurance premiums are rising, but also costs – 71 million were paid out in the three quarters of this year euros in health insurance reimbursements, up 22% from last year.The second reason for the increase in health insurance premiums can be found in rapid inflation, which, when the price of medical services rise significantly, also affects insurance payments and premiums for new policies.” , – explained the president of LAA Janis Abashins.

In just nine months of 2022, insurance premiums in Latvia reached 489.8 million euros, which is 17% more than last year. Double-digit growth in premiums was observed for all major types of insurance, except for life insurance: health insurance by 18%, CASCO by 22%, OCTA by 33%, property insurance by 14% and life insurance by only 4%. Travel insurance, which grew by 70% in the first nine months of this year, has returned to pre-pandemic levels in terms of volume.

In general, payments grew significantly faster than premiums – by a quarter or 25%, reaching 317.4 million euros. Significantly higher amounts than last year were paid to clients in health insurance (+22%), life insurance (+48%), CASCO (+24%), OCTA (+15%) and property insurance (+7%) , as well as travel insurance (+182%).

“The rapid growth in benefits is not only the result of an increase in the number of insured events, but also the result of inflation, since this year the prices of goods and services that must be covered after the occurrence of an insured event have increased significantly. There is another explanation for the disproportionately rapid increase in claims for life insurance – due to the war and the instability of the financial markets, many clients terminated their accumulative insurance contracts. We think this is wrong, because the clients “fixed” the lowest moment in their savings,” Abashins stressed.

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