Insurance
From The Report: Mongolia 2013
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While insurance in Mongolia remains in its nascent stages, important ongoing reforms may yet drive penetration, build local underwriting capacity and develop the first pool of domestic non-bank institutional investors. While the aggregate sums involved remain modest, buoyant growth bodes well for the medium term. The market is dominated by eight firms, which together account for 89% of non-life premiums. Three underwriters alone account for 54% of the market. New entrants are spurring competition with established players, driving innovation in product development and distribution channels. New rules for private insurers will have to be matched by wide-ranging reform of the states social insurance system. Promoting social acceptance of insurance will be crucial for long-term growth, with underwriters still to overcome distrust of private cover.

This chapter contains an interview with T. Batzul, CEO, Mongol Daatgal.

Articles from this Chapter

Overview

The only way is up: Rapid growth is set to continue, with total premiums still at a low level
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While insurance in Mongolia remains in its nascent stages, important ongoing reforms may yet drive penetration, build local underwriting capacity and develop the first pool of domestic non-bank institutional investors. Admittedly, with total premiums as a share of GDP at a mere 0.44%, or $29.3m, in the first half of 2012, according to the Mongolian Insurers’ Association (MIA), the sector still has a way to go. While the aggregate sums involved remain modest, buoyant growth bodes well for the…

Interview

OBG talks to T. Batzul, CEO, Mongol Daatgal
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Interview: T. Batzul What regulatory changes are needed to facilitate the investment of premiums? What could be done to increase insurance penetration rates? T. BATZUL: Insurance firms are normally among an economy’s institutional investors, but current legislation prohibits this in Mongolia. Certain authorities are actively working to address this issue to permit insurance companies to enter the capital markets as institutional investors. One approach would be to convert insurance firms into…

Analysis

Reform school: Moves are afoot to provide a more level playing field for private insurers
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The Social Welfare Law (SWL) passed by Mongolia’s parliament in January 2012 will bring much-needed reform to a system of pay-as-you-go contributions that has proved unsustainable and hampered growth in private insurance provision. Ending universal cash handouts and targeting welfare spending to the most vulnerable, the new Ministry of Human Development and Social Welfare (which replaces the former Ministry of Social Welfare and Labour) aims to create a more level field. LEGACY SYSTEM: Instated…

Analysis

Life is beautiful: Interest is building, with the number of providers set to grow
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Although the first life insurer licence was awarded to National Life Daatgal in 2008 and premium income has more than doubled every year since, the segment remains minor, accounting for a mere $244,000 in premiums in the first half of 2012, out of the industry total of $29.4m. Established by Mongolian Investment Holding Group, the underwriter has prompted others to announce their interest in launching life subsidiaries. These include Bodi, Mongol, ARD, Tenger and Mandal. STARTING BLOCKS: Shunning…