Governor Ismaili speaks regarding the challenges of the insurance sector at the international conference held in Tirana: This market has great potential for further development

Under the organization of the Ministry of Finance and Economy of the Republic of Albania (MFE), the Financial Supervision Authority (FSA), the World Bank (WB), the Swiss Embassy and Finance For Development (F4D), the conference ” Insurance Sector Development – Opportunities and Challenges in Southeastern Europe ” was held in Tirana.

The Governor of the Central Bank of the Republic of Kosovo (CBK), Ahmet Ismaili, in the session on the opportunities and challenges this sector is going through, within the second panel, has emphasized that the insurance market in our country is still considered new in terms of advancement and has great potential for further development.

“The insurance market in Kosovo is still considered new in terms of development and has great potential for further development. The insurance sector does not fulfill its potential, in the absence of products and proper interest from citizens, so many families and enterprises remain uninsured against major risks”, Governor Ismaili emphasized.

Speaking about the insurance market in Kosovo, the head of the CBK emphasized that there is a certain degree of concentration, in terms of insurance classes, with an emphasis on mandatory ones.

“There is a certain degree of concentration in the insurance market in terms of insurance classes. The insurance sector is dominated by the non-life segment with 95.2 percent, which in turn is dominated by Motor Third Party Liability (MTPL) with 58.9 percent”, emphasized the head of the CBK at the conference held in Tirana.

“Also, this sector has been associated with problems and challenges related to financial stability and compliance with the regulatory requirements of some insurers, mainly due to poor corporate governance and ineffective internal controls, underestimation of technical provisions, etc.” added Governor Ismaili.

According to Governor Ismaili, despite all the improvements due to the sensitive nature and level of development, this sector remains a high priority for the CBK.

“This sector remains a high priority for CBK. As important as it was to overcome other problems facing this sector, even more important remains the improvement of corporate governance, internal control, satisfactory levels of reserves and performance.”, asserted Governor Ismaili.

Governor Ismaili mentioned the good cooperation with the FSA and regional and international supervisory institutions.

Governor Ismaili emphasized that the CBK is committed to improving the legal infrastructure and aligning it with that of the European Union.

“We are actively engaged in improving the legal infrastructure in line with new developments in EU legislation and best practices. There are a number of new regulations that have been drafted and are on the verge of approval, and a number of others are in the process of being amended.”, stated Governor Ismaili.

In this panel, the head of CBK also spoke about the plans for the insurance sector, which includes the move towards Solvency II, the implementation of the International Financial Reporting Standard 17 related to the insurance sector, presenting the challenges for the implementation of these standards.

In the end, Governor Ismaili mentioned the challenge of membership of the Republic of Kosovo in the Council of Bureaus.

“Due to political reasons, currently Kosovo is not able to join the International Council of Bureaux (CoB). The lack of a Green Card for motor vehicles with RKS license plates is a serious obstacle to the free movement of people (vehicles) and goods (transport), which requires an immediate solution with the support of the institutions”, concluded Governor Ismaili.