Ingosstrakh opened a representative office in friendly Turkey

One of the largest insurers, Ingosstrakh, opened a representative office in Turkey. This company is already present in China, India, Azerbaijan and Kazakhstan. According to experts, other large insurance companies may also be interested in opening representative offices in friendly countries, primarily for reinsurance. However, they warn of serious risks in the development of such a business.

Ingosstrakh (according to the results of 2022, it ranks third with fees of more than 163 billion rubles, according to the Expert RA rating agency) opened its representative office in Turkey, follows from the company’s reporting for the first half of 2023. However, the insurer already has representative offices in China, India, Azerbaijan and Kazakhstan.

Other large insurance companies (IC) have representative offices abroad. So, in 2016, SOGAZ received registration in China. Rosgosstrakh noted that they also “have long had a representative office in the People’s Republic of China.” AlfaStrakhovanie and VSK said that they do not have representative offices abroad. At the same time, AlfaStrakhovanie does not plan to open them outside the Russian Federation; VSK refused to disclose plans to open representative offices. RESO-Garantia and SOGAZ did not respond to Kommersant’s request.

Ingosstrakh noted that they are always interested in expanding their international presence and cooperation.

The All-Russian Union of Insurers (VSS) noted that the UK is interested in international expansion.

“For Russian insurers, the most promising are the largest and dynamically developing Asian markets, primarily China and India, we can also note countries close to us, such as Kazakhstan, Azerbaijan, Turkey, Armenia, with which a significant trade turnover has been established, as well as distant, but promising markets , for example, Indonesia,” says Alexei Yanin, managing director for ratings of insurance and investment companies at Expert RA.

Experts believe that today, first of all, such countries are of interest to the UK for the development of reinsurance. “Interest in opening representative offices is seen primarily in establishing long-term contacts for the development of international reinsurance,” notes Mr. Yanin. “We believe that building business relations between Russian companies in friendly jurisdictions can have a positive impact on the subsequent placement of risks in reinsurance in these countries,” the ARIA added.

Nevertheless, according to independent expert Andrey Barkhota, for example, Asian partners are not able to satisfy the needs of the Russian insurance market in full, only by 40-60%.

At the same time, according to Yevgeny Sharapov, director of ratings of insurance companies of the NKR agency, with a high degree of probability, Russian companies enter the market of such countries to serve the interests of Russian companies. First of all, we are talking about working in countries with which the Russian Federation has developed trade relations and through which there are large cash flows, he clarifies. “Also, the opening of a representative office may be the first step in studying the relevant market on a longer-term path to creating a subsidiary or branch,” adds Mr. Yanin. “A representative office is not enough to directly engage in insurance abroad.” This requires subsidiaries or at least branches with the appropriate licenses from the regulator of the country of location, he explains.

However, experts warn of risks. According to Kommersant’s interlocutor from among insurers, not many companies will open their offices outside of Russia due to local insurance regulation, in particular high admission ticket prices, international rating requirements that Russian companies do not have left, as well as difficulties in settlements between countries. The situation is also affected by the uncertainty of sanctions, which, if they are expanded, can completely block the possibility of interaction between the parent company and the representative office abroad, he adds.

Julia Poslavskaya