Concentration of the insurance industry in selected transition countries of Central and Eastern Europe, 1998–2006

Abstract

Until the beginning of the 1990s the insurance markets of the transition countries of Central and Eastern Europe were highly concentrated, which means that one or only a few state-owned insurance companies operated on the market, with the market share of the leading company higher than 90%. At the beginning of the 1990s private investors entered the majority of economic sectors, including the insurance market. The entry of new companies has led to a decrease in concentration, i.e. to increased competition. This article analyses the dynamics of concentration of the insurance industry, and seeks to determine the impact of the leading insurance company on the development of the insurance market. Furthermore, the article examines the influence of the purchasing power of the population, measured by gross domestic product per capita, on the development of the insurance market and considers the potential scenario of development of the insurance market in the future.

Measuring recent changes of insurance gross premiums distribution using ten inequality measures: case study of Croatia

“…There are several papers presenting studies elaborating the concentration or inequality of assets and some other financial variables' distributions over the total number of financial institutions as market subjects in Croatia, such as banks (Dumičić, Čeh Časni, & Čibarić, 2008;Dumičić, Pavković, & Akalović Antić, 2012;Ljubaj, 2005;Tipurić, Kolaković, & Dumičić, 2003); investment funds (Morić Milovanović & Galetić, 2005;Valdevit, Čibarić, & Žmuk, 2008); pension funds (Bahovec, Dumičić, & Žalac, 2011). A study of the insurance markets of the transition countries of Central and Eastern Europe in 1990s is presented by Tipurić, Pejić Bach, and Pavić (2008) and Bauer (2012), showing similar results, but these results are based on using of only several number of concentration measures.…”

An empirical investigation of determinants of life insurers’ performance: Evidence from selected countries in Central, Eastern, and Southeastern Europe (CESEE)

“…On the other hand, four countries (Bulgaria, Croatia, Hungary, and Slovenia) show no significant improvement in the market concentration, even Bulgaria becomes more concentrated in the post‐2014 period. Evidently, the entrance of new players in these markets accelerated the transition from monopolistic to oligopolistic competition jeopardizing the existent players’ profitability (Tipurić et al, 2008).…”

Determinants of profitability of life and non-life insurance companies: evidence from Ecuador

“…Insurance profitability is related to the firm internal conditions or microeconomic factors and to macroeconomic factors, and also to industry-related factors which refer to the influence of variables that are not only the product of managerial decisions such as the concentration index and firm market share (Athanasoglou et al , 2008; Bourke, 1989; Tipurić et al , 2008). Therefore, knowing clearly most of the variables that influence the insurance industry is not only important for the institution per se , but also for public policy makers involved in the financial system such as central banks, supervisory institutions of financial sector and also the government as the main stakeholder in economic growth.…”