The year of 2015 brought many risks to the Georgian insurance industry. The Tbilisi natural disaster reminded the insurance companies, the Authorities and ordinary citizens that the insurance culture in the country is undeveloped and this direction should be somehow stimulated, even at the legislative level.
“The Tbilisi natural disaster brought new challenges in the country in 2015. The insurance companies estimated losses in the shortest period. It would be impossible to remunerate similar losses so quickly. The damaged and annihilated automobiles were compensated without franchise. Private business spaces that were damaged by the natural disaster were also remunerated timely.
The sector has showed a high level of readiness for providing timely reaction and assisting people in emergency situations. The insurance companies have demonstrated unprecedented solidarity and professionalism.
The agro insurance pilot program was also of crucial importance. The program is to insure various risks in the agribusiness sector. The project has remunerated many small and major losses.
In 2016, the sector will introduce the automobile owner’s civil responsibility insurance product that is one of the leading mandatory insurance packages in the world. At the initial stage, “the bill on Insurance of Civil Responsibility of Owners of Automobiles Registered in Other Countries” is being developed.
Under the bill, the insurance package will be mandatory for owners of the automobiles that are registered in other countries, but drive in Georgia and participate in the road traffic in Georgia. As a result, the losses inflicted by this category of automobiles to the health, life or property will be remunerated under the law-determined requirements.
To ensure the financial stability of insurance companies, the solvency margin will be introduced and the supervisory capital will be determined that will be supported by both bylaws and legislative acts. This is the worldwide-recognized standard and we must establish it in Georgia. In the future, the minimum capital of the companies will increase stage by stage, due to the class and form of insurance. The first stage was fulfilled. We also plan to introduce internal audit standards in the companies to tighten and strengthen internal control systems and to make the process more transparent and refined.
Starting 2016 insurance mediators (brokers) will be controlled by a joint regulatory system. They will be obliged to submit periodical performance reports to their offices. The requirements for registration of insurance brokers will be also expanded.