State Insurance may be designated as the national operator for reinsurance

The Ministry of Economy and Commerce of the Kyrgyz Republic has presented a draft resolution for public discussion, according to which the open joint-stock company "State Insurance Organization" (Gosstrakh) may be appointed as the national operator for reinsurance.

The main objective of this project is to create a national reinsurance capacity, which will enhance the reliability of the insurance market and the financial stability of insurance companies, as well as protect the property interests of policyholders and beneficiaries. This document has been developed in accordance with the Decree of the President of the Kyrgyz Republic "On measures for the development of the insurance market of the Kyrgyz Republic" dated March 20, 2024, No. 79.

Current situation in the insurance market
As of today, there are 16 insurance companies operating in Kyrgyzstan. From 2021 to 2024, the total volume of collected insurance premiums amounted to 11 billion 659.8 million soms, with a loss ratio during this period of 20.5%, equivalent to 2 billion 392.09 million soms.

A significant portion of risks is transferred to foreign reinsurance companies. Over the past four years, foreign reinsurers have received 3 billion 493.2 million soms, which accounts for 29.9% of the total volume of collected insurance premiums. In the current year 2024, the volume of premiums transferred for reinsurance amounted to 1 billion 499.4 million soms, of which 221.2 million soms (14.8%) were transferred domestically, and 1 billion 278.2 million soms (85%) were sent abroad.

Cooperation with the Eurasian Reinsurance Company
Kyrgyzstan is a participant in the Eurasian Reinsurance Company (EPC), and in accordance with the law ratifying the agreement signed in Yerevan in 2022, it owns 2% of the authorized capital of the EPC, which corresponds to 300 million Russian rubles.

Selection of OJSC "GSO" as the operator
The draft resolution proposes to appoint OJSC "State Insurance Organization" as the national operator for reinsurance, including export risks within the framework of cooperation with the EPC. The Ministry of Economy emphasizes that Gosstrakh has a stable financial condition, qualified personnel, and a broad client base. As of January 1, 2025, the company's authorized capital amounts to 1 billion 144.3 million soms, and 100% of the shares are state-owned.

According to the presidential decree, the following is provided:

• allocation of 150 million soms in 2024 to increase the authorized capital of Gosstrakh;


• gradual increase of the capital to 5 billion 150 million soms by 2028;


• allocation of 100% of the net profit of Gosstrakh to increase the authorized capital until 2027.

New reinsurance rules
The draft also includes the approval of the Regulation on the national operator for reinsurance. According to this document, insurance companies, when transferring risks to foreign reinsurers, must initially offer at least 10% of these risks to OJSC "GSO," with a gradual increase of the share to 50% in subsequent years. The transfer of risks abroad is permitted only after receiving a written refusal from Gosstrakh. All risks that are subject to reinsurance in the EPC must be transferred exclusively through the national operator.

The Ministry of Economy emphasizes that the adoption of this resolution will reduce the outflow of finances beyond the country's borders, strengthen the national insurance market, and create a modern reinsurance infrastructure in Kyrgyzstan. The implementation of this initiative is expected to enhance the competitiveness of the insurance sector, protect large investment and infrastructure projects, and promote the development of international cooperation in the field of reinsurance.