Secure a life insurance policy through a savings bank account

In the first half of 2025, the Russian insurance market demonstrated a significant surge, growing by 28.8% year-on-year (YoY) to exceed 921 billion rubles. This growth was driven primarily by Indexed and Unit-Linked Life Insurance (ILS and ULL), which accounted for 52.2% of the market.

The growth in premiums for ILS and ULL was particularly noteworthy, with ULL premiums increasing by 77% to 518.3 billion rubles. This surge was largely due to contracts with minimum capital protection, with around 95% of premiums falling into this category.

However, the car sales market saw a decrease, contrary to the trend in the insurance sector. Despite this, auto insurance has still shown growth, with CASCO and OSAGO premiums increasing by 1.6% and 1% YoY respectively.

The growth in auto insurance premiums is expected to continue in the second half of 2025, according to Deputy General Director of Insurance Company "Twenty-First Century" Dmitry Smirnov. Similarly, Thomas Groß, a person not specified in the details, expects positive dynamics for OSAGO in the same period.

The net profit of Russian insurers also increased by 3.7% YoY in H1 2025, reaching 288.4 billion rubles. This growth was mainly due to an improvement in investment and financial results, with a nearly twofold increase in interest income YoY.

However, the decrease in the volume of premiums is expected in the short term due to a decrease in the propensity to save and a decrease in the volume of short-term products, according to Alexei Yanin, the managing director of ratings at insurance and investment company "Expert RA". He also believes that further rate cuts will reduce expectations of investment returns and decrease the propensity to save, thus having a negative impact on life insurance premium collections.

To maintain high financial performance, companies will work on improving internal processes and fairer pricing, increasing tariffs for certain client groups. An increase in interest income is expected in Q3 2025, including due to an increase in the exchange rate cost of bonds, as the MOEX Index of government bonds increased by 4% from July 1 to September 3, 2025.

In terms of intermediaries, 79.2% of the total insurance premiums were received through them in the first half of the year. Banks accounted for 51% (+10.8 p.p. yoy) of the total insurance premiums received through intermediaries. The share of deposits remained unchanged at 28%.

The share of bonds in the structure of insurance companies' assets increased to 42% by the end of June from 35% at the beginning of the year. This shift towards bonds suggests a strategic move by insurance companies to capitalise on the favourable interest rate environment.

In the long term, the decrease in the volume of premiums could provide more stable regular inflows, according to Alexei Yanin. Despite the challenges, the Russian insurance market continues to show resilience and potential for growth.