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One year from the 2019 earthquake

Home Press Release One year from the 2019 earthquake

Interview with the CEO of the insurance company Mr.Klaidi Çitozi, about the earthquake of September 21 and November 26, 2019!

 

 

1. When we are one year away from the earthquake, how do you see the tendency for securing property in the Albanian market. Do you notice the awareness or the effect of panic and fear has faded leaving room for indifference to this type of insurance? How does the trend manifest in businesses and individuals?

 

Indeed more growth in housing insurance was expected. There was an increased interest in the first two months after the earthquake and an increase in housing insurance, but currently, the figures show that we are at the same levels as last year. Despite the great damage caused by the earthquake, and not just financially, public awareness of the importance of insurance is still lukewarm. Individuals have shown more interest than businesses, as part of the businesses are secured, some of the liability from banks, and the rest from the culture and influence of foreign investors.

 

2. How much damage has been paid to date by SIGMA related to the earthquake events of September 21 and November 26, 2019?


The bill of damages of the November 26 earthquake for the insurers of our company, reached the figure of 4.5 million Euros. The exposure was high, the work for their evaluation was very great, as we had never been faced with such a large number of damages occurring at once. However, a well-capitalized company like Sigma, managed to assess and pay the damages incurred in record time, thus not compromising the continuity of business and normal life of the families who had chosen to secure their apartment in our company.

 

3. How many files are under review regarding this event and how many individuals or entities have been affected by the event?


All files that have applied so far have been reviewed. There were about 660 files handled, but it must be said that 85% of them were secured by liability from banks. Only 15% of these cases are insured because of their awareness, or that it is in the business practice they conduct.

 

4. The pandemic has shifted attention to the part of compulsory property insurance against earthquakes, a topic that was widely discussed in the months following the November incident. Do you think there is a need to bring back the debate once again and establish an appropriate scheme in order to insure against events such as earthquakes?


It is very true that the pandemic has somewhat diverted attention from compulsory disaster insurance, but for fragile economies and small budgets like ours, this insurance should be an absolute priority. A catastrophe affects not only the lives of citizens, but also the state budget, and therefore it is necessary to find a final solution.

No government should undertake reconstruction in the event of a catastrophe. The government creates a budget for civil emergencies to save human lives and living things, while reconstruction should be everyone's responsibility. If this responsibility is transferred to insurance companies, then we have a multifaceted benefit, the state budget is not affected, citizens are compensated in reasonable time for the damage occurred and we have a development of the insurance market. The state should be responsible only for the constructions to be within the set standards and meeting all the criteria.

 

5.How has the behavior of reinsurers in foreign markets changed in relation to the risk that Albania represents after the earthquake events?


Even before the November 26 earthquake, Albania was classified as an area with high seismological risk. Of course, an increase in tariffs is expected in 2021, caused by the earthquake but also affected by the pandemic. This increase did not take place until 2020, as reinsurance agreements were entered into before the earthquake occurred.

Also, reinsurers expect us to make a more careful inspection of the insured property, regarding the location of the property as well as the protocol followed in its construction. This will also bring about a change in our approach to clients, especially in insurance acquisition procedures.

However, our company is part of a strong group like VIG, and is supported by reinsurers who are leaders in the global insurance market, and their consistent policies, guarantee that we will be close to customers in case of major disasters.