The Supervisory Board of Russian National Reinsurance Company has approved the five-year Company Development Strategy according to which RNRC is to become the unconditional leader on the Russian reinsurance market with premiums of RUB 24.7 billion by 2022.
RNRC JSC was founded in July 2016 by virtue of Federal Law no.363-FZ dated July 3, 2016 “On amendment of the Law “On Insurance Business in the Russian Federation”. The Company was established for the purpose of creation of additional reinsurance capacity in Russia to support the part of the Russian business that has issues with placement of risks on international markets.
| RNRC mission: “Protection of property interests of Russian government, business and citizens, securing of financial stability and efficient development of the Russian insurance market, its integration into the global insurance market.” |
The strategy anticipates that within 5 years apart from the leadership positions, RNRC will become one of the world’s high tech and professional centres of insurance competencies and an investment attractive company with a diversified portfolio.
RNRC is planning to promote popularization of insurance and market development by elaboration and implementation of uniform standards of insurance coverage and creation of new products that will be in demand among Russian policy holders and insurers and will be reinsured by RNRC. The Company will actively develop analytics and information technologies in its business, offering technological services and innovative insurance solutions to the market.
The strategic objectives include the building of an information system with an operational insurance system to support underwriting business processes and claim settlement and a centralised financial system that will include investment portfolio management and will meet the current and planned regulatory requirements such as XBRL and Solvency 2. Besides, following best practices in corporate management is also of strategic importance for the Company in the context of attraction of additional investments in the future.
The RNRC development scenario, which is set up in the Strategy, is mainly based on the forecast of the situation on the Russian reinsurance market. The forecast in its turn is based on the expected moderate growth of the corporate insurance market, the main market segment ceded to reinsurance. According to RNRC forecast, the annual growth rate of the inward reinsurance market in Russia in 2017-2021 will be 4% on the average. Additional growth will be possible subject to implementation of legislative initiatives providing for reinsurance in the home accident business. The key goal of RNRC on the Russian market will consist in the growth of its portfolio not connected with cession and sanctioned business, the aggregate share of which shall not exceed 50% in the total amount of premiums of the Company. The main drivers of the Company’s growth will be Russian business ceding more than 10% (approx. 30% in the portfolio by 2022), international business (approx. 20% in the structure of company’s premiums) and premiums resulting from launching of new insurance products.
The Company strategy provides for profitable development in both insurance and investment areas with an expected return on equity of at least 19%.
According to its President, Chairman of the Board of RNRC JSC Nikolay Galushin, the Company is planning to meet its goals not only due to strong starting positions determined by the shareholder and the capital. “A strong company can be built only by offering really competitive products and services to the market, - said Nikolay Galushin. Only by gaining confidence with competence and high quality of services, facilitating market development and prosperity of its players. Sharing our analytics and technologies, we can be not only the largest reinsurer in Russia, but a really authoritative and recognized market leader.”
“Russian National Reinsurance Company” Joint-Stock Company was founded by virtue of Federal Law no.363-FZ “On amendment of the RF Law “On Insurance Business in the Russian Federation”, by Resolution of the Board of Directors of its sole shareholder, the Central Bank of Russia, which owns 100% of the Company shares. Paid-up capital of the company is 21.3 billion roubles. Reinsurance license ПС no. 4351 dd. 12.10.2016. ACRA Rating AAA (RU), stable outlook.
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RNRC was established by the Central Bank of Russia, pursuant to the Parliament law on the mandatory cession for all Russian insurance companies. 10% of every Russian risk transferred to reinsurance should be offered to RNRC. As for the shares in the risks of the companies that are under the international sanctions regime, RNRC must take them for reinsurance in the amount of 10%. RNRC is allowed to undertake all other risks according to its own underwriting policy. Paid-up capital of the company is RUB 21.3 billion. Recently, the Russian Analytical Credit Rating Agency assigned RNRC the AAA (RU) rating with the stable outlook.