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The KD Group Annual Report 2009
INSURANCE
The insurance-related activities of the Group KD Group include life and property insurance (including health insurance. Two
life insurance companies operate in Slovenia: KD Življenje, a life insurer, and Adriatic Slovenica, a universal insurer that
markets life insurance and property insurance, including health insurance. In accordance with the Group's strategy of
expansion to foreign markets, in 2009 insurance companies within the Group operated in the following foreign markets:
Ukraine, Croatia, Romania, Bulgaria and Slovakia through subsidiaries. Property insurance is marketed by property
insurance company AS neživotno osiguranje a.d.o. Beograd in Serbia.
Features of the Slovenian insurance market in 2009
In the history of business, 2009 was marked by the biggest global economic crisis which affected also the field of insurance.
This is evident in a moderate growth of property insurance premium and negative growth of gross life insurance premium.
Experts assume that the latter is a consequence of a lower interest among the population to invest free assets in investments
funds which have accelerated the growth of life insurances in the past years. At the same time the market is becoming more
and more competitive since foreign insurance companies are entering the market of the already fierce domestic competition.
By the end of December 2009, there were 23 insurance entities engaged in the insurance activities and based in the
Republic of Slovenia. Among them, 11 insurance companies sell life insurances, 2 reinsurance companies and 3 affiliates of
foreign insurance companies. The competitiveness in the insurance sector has become stronger in all segments, especially
in the field of life and health insurance.
In terms of the insurance market development, Slovenia ranks among semi-developed countries. Regarding the share of the
total life insurance premium in the gross domestic product in 2008, Slovenia reached the seventeenth place among the EU
countries, according to the latest available data. It was thus placed before the Czech Republic, Luxembourg, Slovakia,
Bulgaria, Estonia, Latvia, Lithuania, Greece and Romania. Regarding the height of the premium income per capita it holds
the eighteenth place.
Unlike the comparable EU countries, Slovenia still reaches a significantly lower share of life insurances in the total insurance
premium. The share has been constantly growing. From 2000 to 2009 it increased by 11 percentage points, from 19.4
percent to 30.4 percent (including pension insurance). The reasons for such a low share of life insurance are considerable
share of social insurances, insufficient knowledge about life insurance products and lack of awareness of the importance of
such insurances.
In comparison to 2008, the extent of transactions in property insurance companies grew on the average by 5 percent. In
2009, property insurance companies (not considering the Pension Fund Management and the Fund for Craftsmen and
Entrepreneurs) gained EUR 1,445.2 million with property insurance premiums. While a 3.8 percent decrease has been noted
on the life insurance market during the period under review, the ordinary insurance companies (excluding the Pension Fund
Management and the Fund for Craftsmen and Entrepreneurs) gained EUR 486.8 million of life insurance premiums.
Insurance at the Group KD Group
The Group KD Group's key strategic orientations in the insurance division are based primarily on growth in domestic and
foreign operations and the provision of a comprehensive range of financial services through various sales networks.
Thus the Group consolidated and strengthened existing sales channels in Slovenia.
In 2009, Group KD Group insurance companies comprehensively expanded and enriched their portfolios and developed
new, specialised products for individual target groups. In Slovenia, KD Življenje continued in its role as the leader in new
product development and developed two new products in 2009: Fondpolica Maks Garant Plus, Fondpolica Maks Garant with
additional safety features that allow for fast and high return in spite of fluctuating financial markets and Whole life insurance –
life insurance for the event of death with a constant and downward insurance premium and defined insurance term. The
insurance company improved life insurance policies Fondpolica and KD Družina and KD Pokojnine by inclusion of the
Zajamčeni paket (Guaranteed package) a new investment package which makes these insurance products even more
adaptable. With the introduction of the Active investment package the insurance company has upgraded the best selling of
its all investment packages in the Fondpolica investment-linked life insurance packages namely, Dynamic investment
package.
In the field of property insurance Adriatic Slovenica once again developed a range of new products in 2009. It offered Dom
AS, a new, comprehensive immovable and movable property insurance enabling the insurance holders to insure their entire
property (their house, apartment and its equipment, agricultural machines, pets and many more subject matters) with one
policy. In the field of car insurance they expanded their quality offer and launched a new package of car insurance offering
special advantages to the insurance holders upon taking out the car liability insurance (AO) and car liability insurance plus
(AO plus) package. They were the first in Slovenia to introduce something completely new for young drivers - the insurance
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