JSC Insurance Company Unison welcomes the decision of PSP Management to withdraw from non-profile businesses.
It would be good if such decision serves as an example for other businesses operating in the insurance sector as well. It will definitely contribute to improving the competitive environment and depolarization of the market.
More importantly, such initiatives do not depend on the decision of specific businessmen, it is rather the legal environment which dictates the obligation to stay within such frameworks, so that no company is allowed to take a dominant position in the sector. First of all, this shall apply to bank holding groups. Due to the dominance of their non-profile investments and business interests, the insurance sector has practically become a satellite of the banking sector. Current business model is in full contradiction with the best practices of developed countries and protecting the interests of customers. Such negative impacts were also reflected in the Competition Agency report. Current situation significantly hinders the entry of foreign investors into the Georgian insurance sector, since dangers are easily identifiable: “If not affiliated with a bank or a healthcare/pharmaceutical business, you will have to engage in unhealthy competition and will eventually be expelled from the market”.
We have brought this issue repeatedly to voting in the Association of Insurance Companies, but without any support, since the beneficiaries/owners of most companies are banks and licensing medical pharmaceutical holdings, and of course, they will not leave their personal comfort zone so easily. Thus, we left the Association of Insurance Companies, which should have been established with the primary goal and objective to improve the insurance business environment, support fair pricing and correct risk management policies etc., rather than dominating and protecting interests of a few companies affiliated with the banking group and ignoring the true positions and/or mostly just remaining silent.
We will continue to make all efforts to find solutions for the most important issue through legal mechanisms – stated Vasil Akhrakhadze, the Founder and General Director of Insurance Company Unison.