Slovenian insurers have been in the focus lately after showing strong results during H1 of 2024. Save Re’s share price is up 38% YTD, while Triglav is up 9.2%. In this overview, we look at how GWPs have evolved in Slovenia in H1 2024, combined with the overview of how these companies evolved their top lines on the regional markets.
Health insurance regulation change started to strongly influence insurance statistics as the Slovenian Government changed the regulation of supplementary health insurance which was from the end of 2023 moved back from insurers under the State umbrella. Therefore, we are going to look at non-life insurance figures without health insurance. Health insurance premiums total for 2023 amounted to EUR 655m, out of which roughly 90% is related to supplementary health insurance that is paid for full primary care and an extended list of medications. Additional health insurance in Slovenia on H1 2024 has amounted to EUR 32m, which puts the figure at app. EUR 60m annually. On the Slovenian market, Triglav and Generali were active in supplemental and additional health insurance, which has now shrunk to only additional health insurance. When looking at H1 statistics, Triglav holds a 59% market share in additional health insurance in the Slovenian market.
Changes recorded by the Slovenian insurance sector in June 2024 (absolute amount, EUR ‘000, YoY)
Source: Slovenian Insurance Association, InterCapital Research
So, in H1 2024, non-life insurance w/h health in Slovenia is up 13% YoY, in majority driven by growth in its biggest categories Land motor vehicle insurance (29% share), which is up 16% YoY, and motor vehicle liability insurance (24% share). Growth in motor vehicle insurance premiums is a result of the constant growth of vehicles registered but mostly due to the solid growth of average insurance premiums. Other damage to property insurance, the 3rd largest category on the list (13% share), was up 13% YoY, also showing strong growth in the average premium value of this insurance category. Fire and natural forces insurance, with an 11% share in total, was up 17%, which was expected as demand for protection from natural disasters in Slovenia increased after last year’s floods which severely impacted Savinja and Carinthia regions. The 5th largest insurance category, general liability insurance, with a 7% share in non-life insurance w/o health, was up only 3% YoY, while throughout 2023 this category grew 7% YoY on average. In H1 2024, Life insurance is up 7% YoY as growth rates continued from March 2023 supported by strong performance of global equity markets. The most popular Life insurance is still unit-linked insurance where insurers’ return is linked to the result of investment funds and insurers collect underwriting fees. 40% of GWPs in Slovenian in 2024 are related to unit-linked insurance while 23% of total premiums are related to supplementary pension insurance according to the pension and disability insurance act. In H1, unit-linked insurance was up 11.5% YoY, while supplementary pension insurance was up 7% YoY.
Gross written premiums of the Triglav Group by markets in H1 2024 (YoY, annual changes)
Source: Triglav Group, InterCapital Research
Both Slovenian insurance groups are active in the whole region and in H1, Triglav has booked EUR 75m of net income (7x more than in H1 2023), while Sava has evidenced EUR 45m (+11% YoY growth). When looking at the top line, Triglav Group realized EUR 868m of GWPs in H1 2024, which is -3% YoY. The decrease was due to the termination of supplemental health insurance, so insurance revenue from health was down 83% YoY, from EUR 110m in H1 2023 to EUR 19m in H1 2024. When looking at GWP by markets, 11% less premium was written on Slovenia’s market, whereas a 16% growth was recorded in the international market and a 7% growth in other markets of the Adria region. Without looking at regional statistics we can conclude that GWPs in the region have increased even higher than in Slovenia. Each company’s results are dependent on their specific distribution channels in the market and strategy, but we can say that Triglav performed very well in the region. Its GWPs in H1 2024 in Serbia were up 13% YoY, in B&H 11% YoY, in Montenegro 11% YoY and in North Macedonia 24% YoY. When looking at Sava Insurance Group GWPs in the same period, they were up 14%, as Sava was not active in supplemental health insurance, while they are also selling reinsurance services. Sava was even more successful in the EU in Non-life insurance where its GWPs were up 18% YoY, while its Non-life non-EU segment was up 12.5%.
Business volume by segment of Sava Insurance Group in H1 2024 (YoY, annual changes)
Source: Sava Insurance Group, InterCapital Research
The economy of the European Union is set to grow by 1.7% in 2024, according to forecasts by the European Commission. So, the region is bound to grow at least 3%, with even faster growth expected next year. With more than even environmental uncertainty, insurance remains the cornerstone of every commercial business. Furthermore, private entities in the region are converging with insurance premiums towards the EU average. Therefore, we can conclude that the insurance sector presents the most compelling opportunity for investment.
