The aggregate of equity capitals of the insurance companies of Uzbekistan exceeded US$66.8 million and 16.3 billion soums at the end of the first quarter of 2007 (US$63.7 million and 15.7 billion soums in 1Q 2006).
The capital concentration in the insurance market of Uzbekistan is as follows: companies with capital of over 1 billion soums – 44% of all companies, with capital ranging from 500 million soums to 1 billion soums – 32%; and from 100 million soums to 500 million soums – 24% (36% in 2006).
The trend toward the reduction in the number of companies with capital of under 500 million soums through progression to the second and first groups is kept.
The size of the average equity capital (in soums) at the end of the first quarter approached the mark of 800 million soums (exceeds the 1Q 2006 figure by 11%). Increase in the average capital of insurance companies allows us to assume that this growth trend will be kept in the future.
In line with the provision 3 of the Presidential Resolution dated 10 April 2007 No. 618 "On measures to further reform and develop the insurance services market", the Ministry of Justice and the Ministry of Finance together with the State Tax committee are to develop measures by 1 January 2008 to stop the activity and revoke the licenses of insurance companies not complying with the Act on Professional Participants of the Insurance Market which requires that the minimum size of the equity capital of insurance companies is equivalent to at least:
- US$500,000 – in the sector of general insurance;
- US$750,000 – in life insurance;
- US$1 million – mandatory insurance;
- US$3 million – reinsurance only.
Thus, it is safe to assume that by the end of the year insurance companies will further raise their capitals to meet the new capital requirement targets.