Insurance market perspectives in the context of Ukraine's entering the WTO
On March 23, 2007 «Arguments and facts Ukraine» weekly newspaper has hold round table on the topic of «Insurance market perspectives in the context of Ukraine's entering the WTO».
The discussion was hold by the representatives of field state structures, leading insurance companies of Ukraine and independent experts and legislators. VAB Insurance first deputy chairman of the board Mr. Pokotilo Yaroslav Bogdanovich has introduced his point of view in relation to the problems, which domestic insurance companies may face having entered the WTO.
Here are some comments of the first deputy chairman of the board, which were published in «Arguments and facts Ukraine» No. 13 (555) as of 28.03.2007.
Mr. Pokotilo Ya.B. said: «There are already foreign companies and their capital on Ukrainian insurance market. But risks still remain both for the companies and for clients. Strengthening of competition may express in two aspects, i.e. quality and assortment and tariffs. The first one doesn?t bring serious fears, but tariff policy of western players may bear considerable threat for the national companies. There is an economic law, which says that the more sales volume is, the less there are overhead expenses. Sales volume of Ukrainian and foreign insurance companies standing on the porch of insurance market differ by tens and hundreds of times. Foreigners may afford damping; moreover it will be feasible for them. In such circumstances somebody will hold efficient for itself price and, for sure, will loose considerable number of clients. And somebody will reduce prices and loose efficiency, which in the result may lead to lose of solvency. And this is already serious thereat to the clients.
Risks can be reduced at the expense of legal enhancement of increase in capitalization of companies, concentration through merging and take-over of some companies by others».
