Republish from the special edition of Nextdeal (Issue 560)

By Costas Papaioannou

• The significant cash reserves of the Greek s that are not used to protect their lives, pensions, real estate, as well as their professional activities!
• Greek citizens tend to have a lower perception of the risks they run through, compared to the rest of Europeans.
• The vast majority of Greeks range from uninsured to underinsured. Insurance penetration in Greece is at 2,4%!

According to the statistics of the Hellenic Statistical Authority, today in Greece we have 10.413.982 residents, distributed in approximately 4.300.000 households. All of them together, according to the combined data of the Bank of Greece and Tax Authorities, have approximately 196 billion Euros in deposits and significant real estate (privately owned homes, swimming pools, pleasure boats, rental homes, deposits and property abroad)!

Furthermore, no matter how hard we tried, we were unable to accurately determine how many insured people we have in Greece, as a whole, and to make a direct comparison between the population and the insured. However, per insurance sector (or at least by the corresponding number of contracts per sector), from the data officially released by the Hellenic Insurance Association, we have approximately 1 million contracts in the Health sector, 1,6 million contracts in the Life sector and 1,16 million contracts in the Property sector, or approximately 3.700.000 contracts in total in the above insurance sectors!

The per capita insurance premium in Greece amounts to 511,59 Euros, of which 240,62 Euros concern the Life sector and 270,98 Euros concern the general insurance sectors, with the total production of insurance companies for 2024 amounting to 5,7 billion Euros, increased by 8,7% compared to last year.

Last year, per capita insurance premiums were structured as follows:

This practically means that the average per capita premium production in 2024 has correspondingly increased by approximately 11,2% and has reached 511,59 Euros.

What is observed from the per capita distribution of premiums by insurance sector, is that General Insurances come first in production, while Life Insurance is second, which is common in terms of the Greek market.

Furthermore, what is observed in the per capita premiums is that, as far as General Insurance is concerned, out of the total production of all 18 sectors, almost 50% concerns the Automobile sector (along with their mandatory by law civil liability), 25% concerns the Fire sector and the remaining 25% concerns all the other 14 sectors of General Insurance, including the remaining civil liability sectors (except automobiles), the transport sectors, the credit and guarantee sectors and the remaining very important sectors, which if their production had developed, would have skyrocketed both the clientele and the total production of premiums!

Given the fact that a lot of the Insurance Companies existing customers have more than one policy (per household or even per person), which usually concerns the Fire (Property), Life (including Unit Linked, pension benefits and hospital benefits) and Motor sectors (which, in addition to the mandatory Third Party Liability coverage by law, also have some additional benefits such as theft and fire), this leads us to the following conclusions:

1. Approximately 90% of Greece’s population is completely uninsured!

2. Out of the insured, most of them are underinsured, because, in the main, they have only covered their needs related to the automobile and fire sectors (where the majority is underinsured, basically due to mortgage lending), as well as some of their health needs, also having their very intense retirement needs uncovered!

In conclusion, the vast majority of Greece’s population range from uninsured to underinsured in the critical sectors and the corresponding critical needs of its inhabitants, concerning the coverage of their pension needs and their needs related to the insurance of their assets (especially today, an era of climate change and crisis) and because of this, insurance penetration in Greece is very limited and amounts to only 2,4%, according to data from EIOPA and HAIC!

Furthermore, according to the Bank of Greece, extreme weather events have a negative impact on the economy. The direct cost of natural disasters is linked to the restoration of damages, which, due to the significant gap of private insurance protection in Greece, is mostly covered by the State. We expect this to be amended by the new legislative interventions.

In Greece, consumers are not sufficiently informed about the benefits of insurance, the levels of risk they face, the real price of their residence, pension and health insurance, as well as the reliability of insurance companies. According to surveys, Greece has one of the highest percentages of people without insurance experience in the EU.

Further, 57% of Greeks who have insured their residences did not purchase the insurance on their own initiative, but only as a condition for mortgage lending from banks.

Greek citizens tend to have a lower perception of risks associated, not only to natural disasters, but also of the risks related to their investments and retirement and, ultimately, of all the risks they run through!

All the above together, leads us to the conclusion that the Greek market needs to reorient itself and modernize the professional training of insurance executives (sales and administrative) in their entirety, in accordance with modern data, legislative and supervisory data included!

EU is running forward and we aim to approach it, in terms of production!

This requires reorientation, mindset adjustment, modernization and modern education, in order to fill the gaps described above! It is not enough for insurance intermediaries to only be aware the products and what the certification papers of their knowledge define! They must also dive deeper into customer and market data, in order to boost their sales!

Private insurance plays a key role in crucial fields, related to development, which start from mitigating the negative effects of natural disasters and extend to better healthcare and retirement conditions!

Historically, insurers have the knowledge, capital, experience and products to support economic growth and meet the needs of their customers

Read below the article from the special edition of Nextdeal (Issue 560) in electronic form pages 105-106 (click down below right to zoom in)

Who is Costas Papaioannou

He is a Visiting Professor at the University of Athens MBA, specialized in Insurance Administration and a Certified Instructor of insurance subjects, with many years of educational experience.

He is the author of the books: “Investments and Insurance”, Spyrou Editions, 2021, “Insurance Agents”, Spyrou Editions, 2022 and “Basic Training of Insurance Intermediaries in the Sectors and Products of Life and General Insurance”, Spyrou Editions, 2024. In addition, he is co-author of books published by the Hellenic Institute of Insurance Studies and the Hellenic Bank Institute. He is a columnist for Next Deal.

He has studied economics and has a postgraduate degree in insurance.

He has worked as Manager of Education, in some of the largest insurance companies and banks operating in the Greek market.