Azernews.Az

Standard & Poor's Ratings Services published a report titled Kazakhstan Property/Casualty Insurance Sector Carries a Moderate Industry And Country Risk Assessment, the rating agency reported on March 6.

The agency assesses industry and country risk for the property/casualty (P/C) insurance sector in Kazakhstan as moderate.

"Our assessment, which covers both personal and commercial lines, reflects our view of the high country risk and intermediate industry risk in which this sector operates," the agency said.

The agency assesses country risk as high, reflecting Kazakhstan's limited institutional and governance effectiveness due to a highly centralized political environment. However, country risk is supported by Kazakhstan's abundant natural resources giving it strong fiscal surpluses, the government's net asset position, the country's strengthening net external asset position, and above-average GDP per capita growth over the past decade.

"Our assessment of Kazakhstan's industry risk as intermediate reflects our assessment of the country's insurance sector's profitability, product risk, barriers to entry, and institutional framework as neutral," S&P said.

The agency expects market growth prospects to be positive for Kazakhstan P/C insurers, considering the immature nature of the market, which gives potential for substantial growth over the longer term.