Compulsory real estate insurance control in Azerbaijan has to be tightened - company rep
By Trend
A compulsory real estate insurance oversight mechanism has to be created in Azerbaijan, first deputy chairman of the board of Azerbaijani Ateshgah Insurance company Akbar Madatli told reporters in Baku.
Even though the real estate insurance is compulsory, its penetration in the market is about 5 percent, according to Madatli.
“The control over the insurance policy purchase is carried out only during the notarial registration of the property purchase and sale or transfer. That is not enough for full control over the sphere. We repeatedly offered various regulation mechanisms for compulsory insurance, but unfortunately they weren’t accepted by the regulation bodies. This market has a great potential, but to realize it a real estate insurance oversight mechanism has to be created urgently,” Madatli said.
According to the data of Azerbaijan’s Financial Markets Supervision Chamber, fees on compulsory real estate insurance amounted to 27.93 million manats in 2017, with premiums totaling 2.83 million manats.
Currently, 13 insurance companies operate in the country in the field of compulsory insurance of real estate (OJSC Ateshgah Insurance, OJSC Standard Insurance, OJSC AtaInsurance, OJSC Xalq Insurance, OJSC PASHA Insurance, OJSC AXA MBASK, OJSC AzInsurance, State Insurance commercial company AzerInsurance, OJSC Meqa Insurance, OJSC Silkway Insurance, OJSC Azerbaijan Senaye Insurance, OJSC Qala Insurance, OJSC Gunay Insurance).
Compulsory real estate insurance covers all types of buildings including apartments, houses belonging to natural and legal entities and state property. Damage done to the property by a fire, an explosion, a short-circuit in electricity network, crash of sewerage or water supply systems, natural disasters etc. is considered an insurance case.
Tariff on this variety of insurance is 0.2 percent of insurance amount.
Maximum real estate insurance amount in Baku is 25,000 manats, in Ganja, Sumgayit and Nakhchivan – 20,000 manats, in other settlements – 15,000 manats. The price of the insurance is 50, 40 and 30 manats correspondingly.
The Compulsory Insurance Bureau of Azerbaijan (ISB) includes 16
companies, 13 of which are authorized to sell policies of
compulsory insurance of real estate.
(1.7001 manats = 1$ on Feb. 20)
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