Eesti finantsteenuste turg 06/2020THE ESTONIAN FINANCIAL SERVICES
MARKET as at 31 December 2020
This review covers the services provided in Estonia by companies
that come under the supervision of Finantsinspektsioon.
Sakala 4 15030 Tallinn + 372 668 0500 + 372 668 0501
[email protected]
www.fi.ee
CONTENTS 1. GENERAL DEVELOPMENT OF THE FINANCIAL SERVICES MARKET
4
2. DEPOSITS 6
4. LOANS ISSUED BY CREDITORS 15
5. INVESTMENT AND PENSION FUNDS 20
6. PAYOUTS FROM THE SECOND PENSION PILLAR 24
7. MANAGEMENT OF SECURITIES PORTFOLIOS 25
8. THE LIFE INSURANCE MARKET 28
9. THE NON-LIFE INSURANCE MARKET 35
10. PAYMENT SERVICES 43
THE ESTONIAN FINANCIAL SERVICES MARKET AS AT 31 DECEMBER 2020
4
01
Changes in the volume of the main financial services in 2020
4%
12 %
11 %
1. GENERAL DEVELOPMENT OF THE FINANCIAL SERVICES MARKET
1 To avoid repeating data, investments by foreign investment funds
show only investments that Estonian residents have made themselves,
and not through Estonian insurers, investment and pension funds, or
portfolio management services as part of a securities depositing
service.
The development of the Estonian financial services sector in 2020
was affected most by the outbreak of the Covid-19 pandemic in the
spring and by the planned pension reform, but they did not affect
all financial services in the same way. Most financial services
increased their volumes despite the coronavirus crisis, as deposits
and investment increased and more was taken out than before in
housing loans. Demand for some financial services declined though,
as the crisis affected sales of travel insurance most within
insurance for example, since the restrictions reduced travel by a
large amount. Premiums written for motor vehicle liability
insurance were also down. The uncertainty caused by the spread of
the Covid-19 virus made consumers less active in taking new
consumption loans. Life insurance was affected very much by the
pension reform that came in at the start of 2021 and that allows
people to withdraw money directly from their pension fund and not
sign a pension contract with an insurer.
Aggregate deposits grew very fast in 2020, adding 20% or 4.1
billion euros, while growth in 2019 was 12%. The growth was driven
by an increase in the stock of demand and overnight deposits over
the year of 27%, or 4.4 billion euros, while the stock of term and
savings deposits decreased by 13%, or 0.5 billion euros, at the
same time. At the end of the year there was a total of 23.9 billion
euros invested in deposits.
The aggregate stock of the loan portfolios of the banks in Estonia
grew at the same rate in 2020 as in the previous year, adding 4% or
857 million euros, and at the end of the year it stood at 20.7
billion euros. Growth slowed in the aggregate stock of consumer
loans from creditors though to 2% or 23 million euros, leaving the
total stock at 1.19 billion euros at the end of the year.
The amounts involved in investment services mostly grew, as pension
fund assets increased by 12% and investments in foreign funds1 grew
by 8%, but the value of assets of public investment funds fell by
4%. The aggregate volume of individual portfolios increased by 15%.
However, other direct investments in financial instruments, such as
in holding securities, increased by 46% at the expense of
equities.
Table 1. The volume of investment and banking services provided by
financial institutions in Estonia at the end of 2020 (million
euros)
Service Volume of which private Estonian residents
Pension funds 5,557 5,557
Foreign funds offered in Estonia 90 71
Unit-linked funds 301 301 Individual portfolios 685 107 Bank loans
20,668 9,650 Loans by creditors 1,185 -
Demand and overnight deposits 20,677 7,769 Term and savings
deposits 3,111 1,498 Investment and other deposits 129 6 Other
financial instruments 1,006 369
THE ESTONIAN FINANCIAL SERVICES MARKET AS AT 31 DECEMBER 2020
5
02
Financial assets and liabilities of private Estonian residents
(million euros)
Demand and overnight deposits Term and savings deposits Pension
funds Other financial instruments Loans Consumption loans
Investment and other deposits
-12,000
-9,000
-6,000
-3,000
0
3,000
6,000
9,000
12,000
15,000
18,000
Average net financial assets of private Estonian residents
(euros)
In total, the assets invested in financial services aimed at
savings and investment, which includes investment funds and pension
funds, individual portfolios, direct investment financial
instruments, term and savings deposits, and investment and other
deposits, grew by 6% in 2020 to 11.4 billion euros at the end of
the year from 10.7 billion euros at the end of 2019. The amount
held as deposits on current accounts increased by 27% over the year
to 20.7 billion euros at the end of the year. A total of 32 billion
euros was invested in all the different financial services in
Estonia.
Insurance premiums in life insurance declined by 11% to 86 million
euros. Insurance premiums also declined in non-life insurance,
falling 4% to 383 million euros.
The financial assets of Estonian private residents were larger than
their liabilities in 2020, as there were 15.7 billion euros of
financial assets at the end of the year, and 10.8 billion euros of
financial liabilities. The financial assets of Estonian residents
grew faster than their financial liabilities, as aggregate
financial assets increased by 14% and aggregate liabilities by
5%.
This meant the net financial assets of Estonian private residents
were 4.9 billion euros at the end of the year, which was up 1.4
billion euros on the year.
The average private resident of Estonia had financial assets at the
end of the year of 11,814 euros, and outstanding loans of 8150
euros. This gave the average private resident net financial assets
of 3664 euros, up from 2580 at the end of 2019.
THE ESTONIAN FINANCIAL SERVICES MARKET AS AT 31 DECEMBER 2020
6
2. DEPOSITS2
STOCK OF DEPOSITS
2 The data cover credit institutions and Estonian branches of
foreign credit institutions operating in Estonia, and so they cover
the deposits of Estonian residents and non-residents. They do not
cover deposits in the foreign branches of Estonian credit
institutions. 3 Includes deposits taken through online
deposit-taking platforms. 4 Includes state-owned and local
government owned companies. 5 Includes non-profit organisations. 6
Includes insurers and pension funds.
The stock of deposits in banks operating in Estonia increased very
fast in 2020, growing by 20% or 4.1 billion euros3 to stand at 23.9
billion euros by the end of the year, having grown by 12% or 2.2
billion euros in 2019. Deposits grew in 2020 for all the main
client groups, with the deposits of businesses growing the
most.
The stock of demand and overnight deposits increased by 27% over
the year to 20.7 billion euros at the end of it. The stock of term
deposits and savings deposits declined by 13% over the year to 3.1
billion euros at the end of it. This came mainly from private
individuals and financing institutions. Other deposits, including
investment deposits, stood at 129 million euros.
The stock of deposits of businesses4 increased at a record rate of
24% over the year to reach 8.9 billion euros. A large majority of
93% of corporate deposits were demand and overnight deposits, which
totalled 8.3 billion euros, while the remaining 7% was in term
deposits and savings deposits. The deposits of non-resident
businesses increased a little over the year, but they remained
unchanged as a share of corporate deposits at 2%.
The stock of deposits of private individuals5 increased at the same
rate of 13% as in the previous year, and passed the 10 billion euro
mark for the first time to stand at 10.5 billion euros. The largest
part of these private deposits were
demand and overnight deposits, which totalled 8 billion euros or
76% of them. It is notable that the stock of private term and
savings deposits, which had grown stably in recent years, declined
in 2020. Their share in private deposits fell from 28% to 24%. Term
deposits from private individuals that came through specialised
deposit platforms from countries in Western Europe increased in the
first half of the year, but they declined by the end of the year to
where they had started it. At the end of the year, the term
deposits of residents of Western Europe stood at 0.9 billion euros,
or 37% of the term deposits of individuals. Non-resident
individuals held a total of 1.3 billion euros in deposits in
Estonia.
The stock of government deposits increased from 1.5 billion euros
to 2.1 billion euros. Government deposits have never previously
been at such a high level. The stock of deposits of financing
institutions6 increased from 1.8 billion euros to 2.3 billion
euros.
04
1,4 97 1, 84
0
2,000
4,000
6,000
8,000
10,000
12,000
of which non-resident businesses of which non-resident
individuals
Market share by volume of deposits (three largest): Swedbank 45%
SEB Pank 22% LHV Pank 17% Clients: 2,849,385 current contracts
Volume of services: total deposits 23.9 billion euros
THE ESTONIAN FINANCIAL SERVICES MARKET AS AT 31 DECEMBER 2020
7
MARKET SHARE OF BANK DEPOSITS The stock of client deposits grew in
2020 in most banks, with especially fast growth at LHV Pank, which
increased its market share from 14% to 17%. Growth in deposits also
accelerated at the smaller banks, as Coop Pank increased its market
share from 2% to 3%, and Bigbank increased its from 1% to 2%. The
market share of Swedbank fell from 46% to 45% even as deposits
grew, while the market share of SEB Pank fell from 23% to 22% of
all deposits.
Deposits in the market for government deposits grew at all banks,
with particular growth at LHV, which had a 19% share of the market,
Swedbank held the largest share of the market for government
deposits with 34%, and it was followed by SEB with 21%.
The fastest growth in the market for the deposits of financial
institutions was at LHV, where market share grew from 31% to 53%.
It was followed by SEB with 19% and Swedbank with 18%.
07
Market share of government deposits as at the end of 2020 (end of
2019 in brackets)
LHV Pank 19% (14%)
Luminor Bank 19% (22%)
SEB Pank 21% (23%)
08
Market share of deposits of financial institutions as at the end of
2020 (end of 2019 in brackets)
Other 1% (3%) Coop Pank 1% (2%)
LHV Pank 53% (31%)
Luminor Bank 8% (15%)
SEB Pank 19% (19%)
06
Market share of deposits as at the end of 2020 (end of 2019 in
brackets)
Other 2% (2%)
Coop Pank 3% (2%)
LHV Pank 17% (14%)
Luminor Bank 8% (10%)
SEB Pank 22% (23%)
Swedbank 45% (46%)
THE ESTONIAN FINANCIAL SERVICES MARKET AS AT 31 DECEMBER 2020
8
09
Market share of corporate deposits as at the end of 2020 (end of
2019 in brackets)
TBB pank 1% (1%) Coop Pank 3% (1%)
LHV Pank 16% (13%)
Luminor Bank 10% (12%)
SEB Pank 23% (24%)
10
Market share of private deposits as at the end of 2020 (end of 2019
in brackets)
Inbank 3% (3%)
LHV Pank 10% (10%)
Luminor Bank 5% (6%)
Other 1% (1%)
Market share in the market for corporate deposits grew most at LHV
Pank, where it increased from 13% to 16%, and at Coop Pank, where
it increased from 1% to 3%. Swedbank again held the largest market
share with 45% followed by SEB Pank with 23%.
The market for private deposits held stable. There were only
changes in market share at two banks, as the market share of
Luminor Bank fell over the year from 6% to 5% while that of Bigbank
grew from 3% to 4%. Swedbank held the largest market share with 51%
followed by SEB Pank with 22%.
THE ESTONIAN FINANCIAL SERVICES MARKET AS AT 31 DECEMBER 2020
9
Table 2. Number of current deposit contracts* at the end of
2020
Deposit type All deposits of which non-resident deposits
demand and overnight deposits 2,445,989 41,04 of which privately
owned 2,158,610 38,998 term and savings deposits 396,637 43,420 of
which privately owned 390,538 43,369 investment and other deposits
6,759 3,990 of which privately owned 5,868 3,980 * Deposits with
money on account. The number covers both residents of Estonia and
non-residents.
12
5, 84
3, 29
31.12.2019 30.06.2020 31.12.2020
NUMBER AND SIZE OF DEPOSITS There was a sharp jump of 153,725 in
the number of client contracts for deposits at the banks operating
in Estonia in 2020, after growth of 4934 in 2019. The rapid growth
came from the deposits of private individuals, which increased by
139,598 over the year. The number of contracts for corporate
deposits increased by 12,622 over the year.
There were 2,849,385 deposit accounts at the banks operating in
Estonia at the end of the year. The number of demand and overnight
deposits increased over the year by 167,756, but the number of term
and savings deposits fell by 17,248. Other deposits grew for the
first time in a long time, with the number of investment deposits
increasing by 3217, largely due to residents of Western
Europe.
The deposits of resident and non-resident private individuals are
very different in size, and the deposits of non-residents are on
average larger than those of Estonian residents. The difference is
particularly large in term and savings deposits and in other
deposits, where money is received from clients in Western Europe.
The average term deposit of private individuals resident in Estonia
was 4315 euros at the end of the year, while that of the average
non-resident private individual was 21,236 euros. Some banks in
Estonia also took in other deposits from foreign clients in 2020.
This was immediately reflected by a rise in their average size, as
the average other deposit of non-resident private individuals
increased to 25,377 euros.
THE ESTONIAN FINANCIAL SERVICES MARKET AS AT 31 DECEMBER 2020
10
3. LOANS ISSUED BY CREDIT INSTITUTIONS7
THE LOAN PORTFOLIO
7 Loans issued in Estonia by banks. 8 Also includes non-profit
institutions serving households (NPISHs). 9 Includes state-owned
and local government owned companies. 10 Includes insurers and
pension funds. 11 The general government covers the central
government, local governments, the state social insurance fund and
other off-budget funds.
The stock of loans issued by banks increased by 4.3% or 857 million
euros in 2020 to stand at 20.7 billion euros by the end of the
year, having grown by 3.9% or 737 million euros in the previous
year.
The largest part of the loan growth came from private clients. The
loan stock of private individuals8 grew by 478 million euros in
2020, while the stock of loans issued to businesses9 grew by 319
million euros and those to the general government did so by 217
million euros. The stock of loans issued to financial
institutions10 declined by 157 million euros.
At the end of the year, 9.8 billion euros had been issued in
private loans, and 7.6 billion euros in corporate loans. Private
loans accounted for 47% of the total portfolio and corporate loans
for 37%. Loans to financial institutions totalled 2.5 billion
euros, and loans to the general government11 0.7 billion.
Like earlier, the growth in loans to individuals was driven by
housing loans, and this was one of the few types of loan where the
stock increased in 2020. Despite the uncertainty
caused in the economy by the spread of the Covid-19 virus, the
stock of housing loans grew as fast as it had in the previous year,
adding 537 million euros, having increased by 523 million in
2019.
The stock of loans for everyday consumption fell for the first time
in a long time, as consumption loans contracted by 31 million
euros, credit card loans by 18 million euros, and overdrafts by 3
million euros. The volume of study loans was also down, falling by
11 million euros.
Market share by stock of the loan portfolio (three largest):
Swedbank 41% SEB Pank 28% Luminor Bank 12% Private clients: 775,158
current contracts Volume of services: stock of the aggregate loan
portfolio 20.7 billion euros
51
Stock of loans to private individuals (million euros)
THE ESTONIAN FINANCIAL SERVICES MARKET AS AT 31 DECEMBER 2020
11
THE AVERAGE LOAN BURDEN OF PRIVATE CLIENTS
12 Reasons why private individuals and non-profit associations take
other loans include purchases of securities, and starting or
expanding businesses.
Like previously, the largest part of the loan burden of private
clients was made up of housing loans in 2020. The average
outstanding housing loan grew by 2084 euros over the year to 45,803
euros by the end of the year. This was followed by vehicle leases,
though the average outstanding lease fell for the first time,
losing 64 euros to 10,589 euros.
The average outstanding other loan12 increased from 15,233 euros to
15,642 euros. The average amount outstanding in other loans is so
large because such loans are also used to finance business
activities.
Consumer loans from banks, which average 2010 euros, are much
larger than those from creditors, which average 784 euros. The
average consumer loan taken from a bank fell in 2020 by 42 euros,
while the average loan from a creditor increased by 38 euros.
The average outstanding credit card and study loans fell, but only
by a little, so that the average outstanding credit card loan was
837 euros, while the average outstanding study loan was 2118
euros.
Having risen for several years, the number of loan contracts signed
with private individuals fell in 2020 by 5% or 43,422 contracts.
Around half of this was because the number of credit card contracts
fell sharply by 10% or 21,701, while the number of consumer loan
contracts, which had previously only ever risen, fell by 3% or
8945.
The number of housing loan contracts with private clients was
188,980 at the end of the year, up from 185,697 at the end of 2019.
There were 306,067 consumer loan contracts, down from 315,012 at
the end of 2019; 193,178 credit card contracts, down from 214,879;
41,335 overdraft agreements, down from 51,859; 25,523 study loan
contracts, down from 30,781; and 20,075 other loan contracts, down
from 20,352.
53
45 ,8
31.12.2019 30.06.2020 31.12.2020
THE ESTONIAN FINANCIAL SERVICES MARKET AS AT 31 DECEMBER 2020
12
54
Swedbank 41% (42%)
Market share of bank loans as at the end of 2020 (end of 2019 in
brackets)
55
Luminor Bank 3% (7%)
SEB Pank 30% (33%)
Swedbank 35% (43%)
Market share of loans to government as at the end of 2020 (end of
2019 in brackets)
56
Market share of loans to financial institutions as at the end of
2020 (end of 2019 in brackets)
LHV Pank 5% (5%) Coop Pank 6% (5%)
Inbank 1% (5%)
Swedbank 34% (33%)
MARKET SHARE OF BANK LOANS The biggest changes in the distribution
of the loan market in 2020 were the growth in lending volumes at
LHV that increased its market share from 9% to 11%, and the growth
in market share from 2% to 3% at Coop Pank. Swedbank had the
largest market share in the total loan portfolio with 41%, followed
by SEB with 28% and Luminor Bank with 12%. Holm Bank, which entered
the market a year earlier, had less than 1% of the loan
market.
Lending to the government increased substantially in 2020 at LHV,
causing LHV's market share in the government loan segment to
increase from 0% to 22%. The market share of Swedbank fell over the
year from 43% to 35%, and that of SEB Pank was down from 33% to
30%.
Loans to financial institutions are mainly distributed between the
three large banks. Swedbank had the largest share with 34%, while
SEB had 29% of such loans and Luminor Bank had 24%.
THE ESTONIAN FINANCIAL SERVICES MARKET AS AT 31 DECEMBER 2020
13
57
Market share of corporate loans as at the end of 2020 (end of 2019
in brackets)
LHV Pank 15% (12%)
Coop Pank 3% (2%)
Luminor Bank 9% (11%)
58
SEB Pank 27% (27%) Swedbank 45% (46%)
Market share of loans to private individuals as at the end of 2020
(end of 2019 in brackets)
The stock of corporate loans increased particularly quickly at LHV
Pank, and so its market share for corporate loans increased further
over the year, from 12% to 15%. Coop Pank also increased its market
share from 2% to 3%. The corporate loan portfolio of Luminor Bank
shrank, and its market share fell from 11% to 9%. Swedbank held the
largest market share with 38%.
The market share of LHV Pank in the market for loans to private
individuals increased from 8% to 9% and that of Coop Pank did so
from 2% to 3%. Swedbank with 45% and SEB with 27% again had the
largest shares of the stock of loans to private individuals.
THE ESTONIAN FINANCIAL SERVICES MARKET AS AT 31 DECEMBER 2020
14
59
Market share of housing loans to private individuals as at the end
of 2020 (end of 2019 in brackets)
Coop Pank 3% (2%)
Luminor Bank 12% (13%)
60
Market share of consumer loans to private indivi- duals as at the
end of 2020 (end of 2019 in brackets)
Holm Bank 5% (4%)
Luminor Bank 1% (1%)
Swedbank 42% (45%)
Bigbank 7% (7%)
The majority of loans to private clients were housing loans, which
were 88% of private loans at the end of 2020. This means that the
division of the housing loan market affects most what happens in
the market for loans to private individuals.
The four banks that issued most of the housing loans in 2020 were
Swedbank, SEB Pank, LHV Pank and Coop Pank. LHV Pank increased its
market share from 8% to 9%, while Coop Pank did so from 2% to 3%.
The market shares of Swedbank and SEB Pank declined slightly
despite the growth in the loan stock. They remained the leaders in
the market for housing loans though, as Swedbank had 45% of the
market and SEB Pank had 29%.
The stock of consumer loans only grew over the year at the small
banks Inbank, TF Bank AB Estonia branch, and Holm Bank, and their
market share increased as a result. The stock of consumer loans
fell at the other banks. Swedbank held the largest market share
with 42%, followed by Inbank with 23%, and TF Bank Estonia branch
with 13%.
The stock of credit card loans grew only at the small banks Holm
Bank and Inbank in 2020, and the result was that they increased
their market share from 8% to 10% at Holm Bank and from 0% to 1% at
Inbank. The stock of credit card loans fell at the other banks.
Swedbank held the largest market share with 66% followed by SEB
Pank with 15%.
THE ESTONIAN FINANCIAL SERVICES MARKET AS AT 31 DECEMBER 2020
15
4. LOANS ISSUED BY CREDITORS13
13 The data cover consumer loans to private individuals. 14 As well
as making consumer loans to private individuals, creditors also
issue loans to businesses. Finantsinspektsioon does not supervise
these. The stock of loans to businesses stood at 2.18 billion euros
at the end of 2020, and it was 2.31 billion euros at the end of
2019.
In 2020 there were 45 creditors not associated with banks, 11
creditors associated with banks, and 10 credit intermediaries
operating in the market.
The uncertainty caused by the spread of the Covid-19 virus made
consumers less active in taking new consumption loans.
Where 801 thousand new contracts were signed with creditors in
2019, there were 682 thousand new contracts in 2020. There was a
fall over the year of 18% in car lease contracts signed, and of 16%
in other monetary credit, which means unsecured small loans.
New loans worth 736 million euros were granted, after 877 million
euros in loans were issued in the previous year. There was less
lending activity than usual, which restrained the growth in the
aggregate consumer loan portfolio of creditors, so while the
aggregate stock grew by 12% in previous years, the growth was only
2% in 2020, and the aggregate stock stood at 1.185 billion
euros14.
The largest part of the loan stock was held by creditors associated
with banks, which make up 80% of the market for creditors. The
remaining 20% of the market was held by creditors not associated
with banks. The largest market share
among these was held by IPF Digital Estonia OÜ with 3% of the
market, and PLACET GROUP with 2.4%.
Creditors associated with banks mainly operate as leasing companies
and are different from other creditors in the structure of the loan
portfolios and their lending conditions. The average stock of loan
contracts of creditors associated with banks is mostly also
substantially larger.
The largest average outstanding loan amount at the end of the year
was for loans associated with residential real estate, and was for
16,039 euros on average to creditors associated with banks, and for
18,450 euros to other creditors. The average outstanding loan
amount for vehicle leases was of
Market share by stock of the loan portfolio (three largest):
Swedbank Liising 27% SEB Liising 19% Luminor Liising 14% Private
clients: 513,930 current contracts Volume of services: stock of the
aggregate loan portfolio 1.185 billion euros
61
Number of loan contracts signed in 2020 as a proportion of those
signed in 2019 (2019 = 100%)
81% 84%
Q1 2019 = 100% 2020 62
Market share of all creditors by stock of the loan portfolio as at
the end of 2020 (end of 2019 in brackets)
Other* 18% (21%)
Coop Liising 3% (3%) IPF Digital Estonia 3% (3%)
* The market shares of other creditors were: PLACET GROUP OÜ 2.40%,
Telia Eesti AS 1.96%, Creditstar Estonia AS 1.95%, ESTO AS 1.60%,
Hüpoteeklaen AS 1.31%, BB Finance OÜ 1.11%, mogo OÜ 1.11%, Monefit
Estonia OÜ 1.10%, AB Kreditex AS 0.88%, OÜ Citadele Leasing &
Factoring 0.72%, Svea Finance AS 0.64%, OÜ AIRES LAENUD 0.51%,
Omega Laen AS 0.38%, Tele2 Eesti Aktsiaselts 0.30%, Rävala Laenud
OÜ 0.26%, Nordic Hypo AS 0.18%, BestCredit OÜ 0.18%, Medicredit OÜ
0.16%, Fresh Finance OÜ 0.15%, Ehital Krediit OÜ 0.11%, AS Finora
Capital 0.11%, Credit.ee OÜ 0.10%, aktsiaselts Saare Kalur 0.08%,
Mercury Credit OÜ 0.08%, Eesti Ühistuliising OÜ 0.07%, Baltasar
Liising OÜ 0.07%, RE Invest OÜ 0.06%, Stokker Finance OÜ 0.05%,
Berger Financial Group OÜ 0.04%, ALG Liisingu Aktsiaselts 0.04%, OP
Finance AS 0.03%, aktsiaselts UUEMÕISA INVEST 0.03%, Invest in OÜ
0.03%, ON24 Aktsiaselts 0.02%, PC Finance OÜ 0.02%, Best Capital OÜ
0.02%, Autokiirpant OÜ 0.02%, AARE AUTOPOOD OÜ 0.01%, Saare Finants
OÜ 0.01%, Kemotex Finance OÜ 0.01%, Kinnistulaen OÜ 0.01%, OÜ Nemm
Auto 0.01%, Digiteks Osaühing 0.01%, TBB Liisingu AS 0.01%,
Aktsiaselts ESTRAVEL 0.00%, Bondora AS 0.00%, and osaühing
LAENUKESKUS 0.00%.
THE ESTONIAN FINANCIAL SERVICES MARKET AS AT 31 DECEMBER 2020
16
63
Average outstanding loan contract as at the end of 2020
(euros)
10 ,6
Creditors associated with banks Other creditors
10,660 euros to creditors associated with banks, and of 4136 euros
to other creditors. The average outstanding value of other credit
for everyday use was of 1109 euros at creditors associated with
banks and 791 euros at other creditors, and the outstanding amount
on instalment loan contracts was of 946 euros at creditors
associated with banks and 363 euros at other creditors.
THE ESTONIAN FINANCIAL SERVICES MARKET AS AT 31 DECEMBER 2020
17
CREDITORS ASSOCIATED WITH BANKS The sector of the market for
creditors associated with banks is dominated by the leasing
companies of three large banks. At the end of the year Swedbank
Liising had 34% of the loan stock of creditors associated with
banks, SEB Liising had 24% and Luminor Liising had 18%, making 76%
of the market between them.
The loan portfolio of creditors associated with banks stood at 953
million euros at the end of the year, which was up only 0.8% or 7
million euros on a year earlier. The biggest growth was of 11
million euros in the stock of vehicle leases and of 8 million euros
in the stock of other monetary credit. The stock of credit
associated with residential real estate was almost unchanged at the
end of the year, as one creditor transferred its loan portfolio to
its parent bank in 2020.
The number of loan contracts at creditors associated with banks
rose by 3778 in 2020 to 222,417.
64
Market share of creditors associated with banks by stock of the
loan portfolio as at the end of 2020 (end of 2019 in
brackets)
Other 2% (1%)
Coop Liising 4% (4%)
78 2
3 9
11 6
31.12.2019 30.06.2020 31.12.2020
THE ESTONIAN FINANCIAL SERVICES MARKET AS AT 31 DECEMBER 2020
18
CREDITORS NOT ASSOCIATED WITH BANKS The majority of the market for
creditors not associated with banks is held by fewer than half of
the creditors in it as 83% of the stock of the loan portfolio at
the end of the year was held by 10 of the 45 creditors. The
creditors with the largest market share were IPF Digital Estonia
with 15% of the loan portfolio followed by PLACET GROUP with 12%.
Telia Eesti, which specialises in telecommunications and IT
solutions, increased its market share from 8% to 10%, and rose to
third place alongside Creditstar Estonia.
The loan portfolio of creditors not associated with banks stood at
231 million euros at the end of the year, which was up 15 million
euros on a year earlier. The biggest growth was again in other
monetary credit, which increased by 10 million euros to 147 million
euros at the end of the year and accounted for 63% of the loan
portfolio of creditors not associated with banks.
The number of loan contracts increased by 10,170 over the year to
stand at 291,513 at the end of the year.
66
Market share of creditors not associated with banks by stock of the
loan portfolio as at the end of 2020 (end of 2019 in
brackets)
Other 20% (24%)
PLACET GROUP 12% (11%)
Telia Eesti 10% (8%)
Creditstar Estonia 10% (10%)
Outstanding loans to creditors not associated with banks (million
euros)
4 0
31.12.2019 30.06.2020 31.12.2020
THE ESTONIAN FINANCIAL SERVICES MARKET AS AT 31 DECEMBER 2020
19
68
18 15
Credit intermediaries Total creditors and credit
intermediaries
4.1 CREDIT INTERMEDIARIES Alongside providers of consumer credit
there are credit intermediaries operating in the market. A few
years ago it was mainly creditors who operated in the consumer
credit market, but the total number of credit intermediaries has by
now risen to ten.
The turnover of credit intermediaries totalled 15 million euros in
2020, and 18 million in 2019, which is a long way below the 736
million euros of turnover of creditors.
The credit intermediary with the largest market share was Omaraha
OÜ, which had 83% and was followed by Ühisraha OÜ with 9%.
A total of 16,158 consumer credit contracts were intermediated,
which was 27% fewer than a year earlier, and the largest share of
these contracts was handled by Omaraha OÜ, which had 84% of
them.
THE ESTONIAN FINANCIAL SERVICES MARKET AS AT 31 DECEMBER 2020
20
13
22 0
4, 75
Voluntary pension funds
Real estate funds
31.12.2019 30.06.2020 31.12.2020
VALUE OF THE ASSETS OF FUNDS16
15 Investment fund data cover all the clients of public investment
funds registered in Estonia, including foreign clients. 16 Asset
volumes are recorded at market value. 17 Public investment funds
are euro funds, alternative funds and pension funds. The Investment
Funds Act that came into force at the start of 2017 subjects fund
managers that nominate themselves as small funds to limited
financial supervision and reporting obligations, and so they are
not covered by this report. 18 Local equity funds include funds of
funds and mixed funds.
The assets of public investment funds17, including pension funds,
grew by 11% or 580 million euros over the year, and passed 6
billion euros for the first time to stand at 6.03 billion euros at
the end of 2020. In the previous year the volume of assets grew by
943 million euros.
The growth in the funds was again led mainly by mandatory pension
funds, whose assets increased by 546 million euros, or 11%, in 2020
to 5.3 billion euros by the end of the year.
Mandatory pension funds were followed for growth by voluntary
pension funds, whose assets increased by 56 million euros, or 28%,
in 2020 to 262 million euros by the end of the year.
Equity funds18 saw their assets decline by 9 million euros, while
those of public real estate funds declined by 14 million
euros.
Mandatory pension funds are still the largest type of fund,
accounting for 88% of the total assets of the public fund sector.
The volumes of assets of other fund types were of the same size,
with each accounting for 4% of the assets of the public funds
sector.
Market share of funds by volume of assets (three largest): Swedbank
Investeerimisfondid 40% LHV Varahaldus 26% SEB Varahaldus 17% Total
number of shareholders: 949,942 current contracts Volume of
services: total value of funds 6.03 billion euros
THE ESTONIAN FINANCIAL SERVICES MARKET AS AT 31 DECEMBER 2020
21
14
Voluntary pension funds
Real estate funds
31.12.2019 30.06.2020 31.12.2020
SHAREHOLDERS IN FUNDS
19 It should be remembered that many people make investments
through multiple investment and pension funds, and so the actual
number of people investing through funds is smaller than the number
of contracts. 20 The number of shareholders includes
non-residents.
The number of shareholder contracts19 at Estonian public funds
increased by a record 112,177 in 2020 to 949,94220 at the end of
the year. This rapid growth was driven by voluntary pension funds,
where the number of shareholders almost tripled over the year. A
major contributory factor in this was that tax benefits would be
available in future to those joining the third pillar by the end of
the year. The great rise in the number of shareholders did not lead
to any significant growth in assets though. This was because the
new members made relatively small payments into the funds.
The number of shareholders in mandatory pension funds increased by
18,108 over the year, which was almost the same as the growth of
20,184 in 2019. At the end of the year, 7% of all shareholders in
mandatory pension funds had their pension through an index fund, up
from 4% at the end of 2019.
The number of shareholders in public real estate funds increased by
1732 in 2020, and the number in equity funds rose by 1533.
The biggest type of fund among public funds by number of contracts
was mandatory pension funds with 798,072 contracts, followed by
voluntary pension funds with 140,809, equity funds with 9556, and
public real estate funds with 5505.
THE ESTONIAN FINANCIAL SERVICES MARKET AS AT 31 DECEMBER 2020
22
15
Market share of fund services as at the end of 2020 (end of 2019 in
brackets)
LHV Varahaldus 26% (25%)
SEB Varahaldus 17% (17%)
Northern Horizon Capital 3% (4%)
Swedbank Investeerimis- fondid 40% (40%)
Tuleva Fondid 4% (3%)
16
Market share of mandatory pension funds as at the end of 2020 (end
of 2019 in brackets)
LHV Varahaldus 28% (28%)
SEB Varahaldus 19% (19%)
Tuleva Fondid 4% (3%)
17
Market share of voluntary pension funds as at the end of 2020 (end
of 2019 in brackets)
LHV Varahaldus 12% (11%)
SEB Varahaldus 20% (24%)
Swedbank Investeerimisfondid 45% (51%)
Tuleva Fondid 14% (4%)
FUND MANAGERS21
21 The market shares of fund managers are calculated from the
assets of public investment funds registered in Estonia.
The distribution of the market for funds services remained stable
in 2020, and the changes were of not more than one percentage
point. The market share of the fund management market grew for
Tuleva Fondid from 3% to 4%, and for LHV Varahaldus from 25% to
26%, while the market share of Northern Horizon Capital fell from
4% to 3%. The largest fund manager in the Estonian market remains
Swedbank Investeerimisfondid with 40% market share. It was followed
by LHV Varahaldus with 26% market share, and SEB Varahaldus with
17%.
Tuleva Fondid stood out among mandatory pension funds as its market
share grew from 3% to 4%, while the market share of Luminor
Pensions Estonia fell from 9% to 8%. The largest second pillar
pension fund in the Estonian market remains Swedbank
Investeerimisfondid, which had 41% of the market. LHV Varahaldus
had 28% of the market for mandatory pension funds, and SEB
Varahaldus had 19%.
Having received its authorisation to operate as a fund manager for
third pillar pension funds at the end of 2019 and managing index
funds, Tuleva Fondid had 14% of the market for voluntary pension
funds by the end of the year. The market share of LHV Varahaldus
also increased, from 11% to 12%. The market position of other fund
managers declined despite the growth in the assets of their pension
funds, as the market share of Swedbank Investeerimisfondid fell
from 51% to 45%, that of SEB Varahaldus fell from 24% to 20%, and
that of Luminor Pensions Estonia fell from 10% to 9%.
THE ESTONIAN FINANCIAL SERVICES MARKET AS AT 31 DECEMBER 2020
23
18
Market share of public real estate funds as at the end of 2020 (end
of 2019 in brackets)
EfTEN Capital 29% (26%)
19
Market share of equity funds as at the end of 2020 (end of 2019 in
brackets)
Avaron Asset Management 28% (33%)
LHV Varahaldus 2% (2%)
Swedbank Investeerimisfondid 69% (63%)
There were only two fund managers in the public real estate funds
market, Northern Horizon Capital with 71% of the market and EfTEN
Capital with 29%.
At the end of 2020 Swedbank Investeerimisfondid had the largest
market share for equity funds with 69%, followed by Avaron Asset
Management with 28%.
THE ESTONIAN FINANCIAL SERVICES MARKET AS AT 31 DECEMBER 2020
24
20
0
10,000
20,000
30,000
40,000
50,000
60,000
0
20
40
60
80
100
120
140
160
180
0
Number of people with the right to second pillar payouts (right
scale) Their personal balance with the central securities
depositary (left scale)
Number of people with the right to payouts and their account
balances with the Estonian Central Securities Depositary (million
euros)
21
Pensioners with a second pillar pension by type of payout as at the
end of 2020 (end of 2019 in brackets)
No payouts received 20% (23%)
Pension contract 17% (17%)
Funded pension and one-o payout 14% (10%)
One-o payment only 20% (14%)
6. PAYOUTS FROM THE SECOND PENSION PILLAR
22 The account balance at the pensions register consists primarily
of the account balances of people in the register who have chosen a
funded pension, and of those who have not yet made a choice. Under
a pension contract, the personal account balance is transferred to
the insurance company. 23 One-off payments are when the whole
pension fund is taken out at once. 24 A funded pension is an agreed
schedule between the shareholder and the pension fund manager under
which payments are made from the pension fund to the shareholder on
a regular basis over a fixed period. 25 The pension contract is an
insurance contract signed between a shareholder and a life
insurance company under which the insurance company makes pension
payments until the contract holder dies.
Data from Pensionikeskus show that 49,471 people had the right to
payouts from the second pension pillar at the end of 2020, which
was 4304 more than a year earlier. Of these, 36% were men and 64%
were women. Their accounts in the pension register held 180.3
million euros of money not paid out on those accounts22. This
amount increased sharply in the second half of 2019 when the
pension reform was being developed, and it increased at the same
rate in 2020. The account balance at the pension register grew fast
because of a notable rise over the year in the number of people
with the right to receive payouts who had not yet taken any
decision about them. The account balance at the pension register
also contained one-off payments of 41 million euros that had not
yet been made at the end of 2020, but for which applications had
been submitted.
There was a sharp rise in the number of one-off payments23 in the
second half of 2020 after the reform of the second pillar was
introduced, as there were around 11 thousand who had chosen that
option as at the end of 2019, but over 17 thousand people who had
chosen it by the end of 2020, with the growth coming in the second
half of the year.
The share of people who chose only one-off payments increased over
the year from 14% to 20% of those receiving payouts. The share of
those receiving payouts as payments through both funds as a funded
pension24 and one-off payments rose from 10% to 14%. The share of
people who chose only funded pension payments fell over the year
from 36% to 29% of those receiving payouts. The share of people who
had signed pension contracts25 remained at 17%. The other 20% of
those with the right to receive payouts from the second pension
pillar had not yet applied to do so.
THE ESTONIAN FINANCIAL SERVICES MARKET AS AT 31 DECEMBER 2020
25
22
31.12.2019 30.06.2020 31.12.2020
VALUE OF PORTFOLIOS
26 Data on portfolio management cover all the market participants
in Estonia who provide that service, including consultation. Their
clients may be in Estonia or abroad.
Securities portfolio management services are provided by fund
managers, banks and investment firms. The aggregate value of
portfolios grew by 15% in 2020 to 685 million euros, having grown
by 12% in 2019. The largest part of the growth came from banks,
where the aggregate size of the portfolios under management
increased from 467 million euros to 526 million.
The portfolio of clients managed by the fund managers increased
from 102 million euros to 132 million over the year, while the
portfolio managed by investment firms grew from 25 million euros to
27 million over the year.
Market share by size of portfolio (three largest): Swedbank grupp
51% LHV Pank 18% Luminor Bank 18% Volume of services: total size of
portfolios 685 million euros
THE ESTONIAN FINANCIAL SERVICES MARKET AS AT 31 DECEMBER 2020
26
23
559 572 533
27 Financing institutions cover insurers, pension funds, credit
institutions and other financing institutions. Companies includes
state-owned and local government-owned companies. Private
individuals also includes non-profit organisations. Government
includes the state social assistance funds.
Most of the clients in the aggregate portfolio at the end of 2020
were residents of Estonia, who accounted for 88% of the total
volume, or 601 million euros, which was up from 500 million euros
at the end of 2019. Of this, 310 million euros belonged to
financial institutions, 181 million euros to companies, 107 million
euros to private individuals27, and 3 million euros to the
government.
Non-residents had an aggregate portfolio of 84 million euros, the
largest part of which belonged to residents of Latvia.
THE ESTONIAN FINANCIAL SERVICES MARKET AS AT 31 DECEMBER 2020
27
24
Market share of portfolio management by service provider as at the
end of 2020 (end of 2019 in brackets)
Cresco Väärtpaberid 1% (1%)
Kawe Kapital 3% (3%)
LHV Pank 18% (16%)
Swedbank 32% (35%)
25
Market share of portfolio management for banks as at the end of
2020 (end of 2019 in brackets)
LHV Pank 23% (20%)
Luminor Bank 23% (24%)
SEB Pank 12% (11%)
Swedbank 42% (45%)
PORTFOLIO MANAGERS Companies in the Swedbank group had the largest
market share for portfolio management at the end of 2020, with 51%
between them, followed by LHV Pank and Luminor with 18% each.
Among the banks, Swedbank had the largest portfolio at the end of
the year with 42% of the market, followed by LHV Pank and Luminor
Bank with 23% each.
Only two fund managers offered a securities portfolio management
service, and of these, Swedbank Investeerimisfondid had the largest
portfolio. There were also only two investment firms that offer
portfolio management, and the one with the largest portfolio was
Kawe Kapital.
THE ESTONIAN FINANCIAL SERVICES MARKET AS AT 31 DECEMBER 2020
28
8. THE LIFE INSURANCE MARKET Life insurance contracts are provided
in Estonia by insu- rers registered in Estonia and Estonian
branches of foreign insurers. Foreign insurers operating
internationally mainly provide cross-border services in Estonia
through Estonian insurance brokers, but the volume of such
contracts is close to non-existent.
26
Estonian life insurers 52.8 million euros (55.7)
Branches of foreign life insurers 32.7 million euros (40.3)
International contracts intermediated in Estonia 0.5 million euros
(0.4)
THE ESTONIAN FINANCIAL SERVICES MARKET AS AT 31 DECEMBER 2020
29
8.1 NEW SALES OF LIFE INSURANCE CONTRACTS In the first half of
2020, 24,004 new insurance contracts were signed in Estonia, which
was fewer than the 27,030 new contracts signed in 2019. Insurance
premiums of 17 million euros were written under those contracts in
2020, and 28 million euros in 2019. The biggest sales of new
contracts were in the insurance agent segment, through which 13% of
the insurance premiums from new contracts came. New insurance
contracts were signed most through the insurer or an employee as a
direct sale, and 86% of premiums from new contracts came in this
way.
27
Insurance contracts signed through dierent sales channels by number
of contracts in 2020 (2019 in brackets)
Direct sales 86% (63%)
Insurance agents 13% (37%) Insurance brokers 1% (0%)
THE ESTONIAN FINANCIAL SERVICES MARKET AS AT 31 DECEMBER 2020
30
8.2 INSURANCE COMPANIES PROVIDING LIFE INSURANCE
Insurance premiums28
28 The data on insurance premiums come from Statistics Estonia. 29
The data do not cover insurance premiums received from outside
Estonia.
In 2020 the life insurance companies in Estonia received 86 million
euros in insurance premiums29. In the previous year they received
96 million euros in premiums, meaning the volume had fallen by 11%
over the year.
The decline in insurance premiums was due to a sharp reduction in
the pension insurance premiums received. When the pension reform
came in at the end of the year, there was a sharp drop in receipts
of pension insurance premiums. Pension insurance premiums fell over
the year from 18 million euros to 12 million. Insurance premiums
for unit-linked life insurance also dropped substantially, as they
fell over the year from 39 million euros to 34 million. Receipts of
premiums for other types of life insurance were about the same as a
year earlier.
The life insurance product that received the largest amount of
premiums was again unit-linked life insurance, which had 40% of all
life insurance products having had 41% a year earlier. Whole life
insurance was in second place with a share of 24%, up from 21% the
year before. Pension insurance came in third place with a share of
14%, down from 19% the year before. Capital endowment insurance
accounted for 12% of all life insurance products, having been 11% a
year previously.
Market share by insurance premiums (three largest): Swedbank Life
Insurance SE 45% SEB Life and Pension Baltic Estonia branch 24%
Compensa Life Vienna Insurance Group SE 17% Volume of services:
insurance premiums of 86 million euros received in 2020
28
11
39
ns ur
an ce
2019 2020
THE ESTONIAN FINANCIAL SERVICES MARKET AS AT 31 DECEMBER 2020
31
29
Market share of life insurance by premiums received in 2020 (2019
in brackets)
SEB Life and Pension Baltic SE Estonia branch 24% (23%)
Compensa Life Vienna Insurance Group 17% (17%)
ERGO Life Insurance Eesti branch 6% (6%) Mandatum Life Insurance
Company
Limited Estonia branch 8% (13%)
Swedbank Life Insurance 45% (41%)
30
Market share of capital endowment insurance as the end of 2020 (end
of 2019 in brackets)
SEB Life and Pension Baltic SE Estonia branch 50% (51%)
Compensa Life Vienna Insurance Group 5% (5%)
ERGO Life Insurance Estonia branch 10% (10%)
Mandatum Life Insurance Company Limited Estonia branch 5%
(5%)
Swedbank Life Insurance 30% (29%)
31
Market share of unit-linked life insurance as the end of 2020 (end
of 2019 in brackets)
SEB Life and Pension Baltic SE Estonia branch 17% (14%)
Compensa Life Vienna Insurance Group 9% (8%)
Mandatum Life Insurance Company Limited Estonia branch 17%
(28%)
Swedbank Life Insurance 57% (50%)
LIFE INSURANCE PROVIDERS Receipts of insurance premiums fell at all
life insurers in 2020. The insurers were not all affected equally
by the fall, and so this caused some changes in the division of the
life insurance market. The market share of Mandatum Life Insurance
Company Limited Estonia branch declined from 13% to 8% because of
the fall in premiums for unit-linked life insurance. Swedbank Life
Insurance SE managed to maintain its sales of life insurance
products without any major reductions meanwhile, and so its market
share increased from 41% to 45%. There was little change in the
market shares of other life insurance providers.
The premiums for capital endowment insurance fell at the life
insurers operating in Estonia for the 12th consecutive year
including 2020. The market shares of insurers did not particularly
change. The biggest provider of capital endowment insurance in
Estonia at the end of 2020 was SEB Elu- ja Pensionikindlustus,
which had 50% of the market.
There was a particularly large fall in receipts of premiums at
Mandatum Life Insurance Company Limited Estonia branch in the
unit-linked life insurance premiums segment, and so its market
share fell from 28% to 17%. Swedbank Life Insurance SE was again
the largest provider of unit-linked life insurance in Estonia, with
57% of the market.
THE ESTONIAN FINANCIAL SERVICES MARKET AS AT 31 DECEMBER 2020
32
Receipts of pension insurance premiums fell substantially at all
insurers in 2020. Compensa Life Vienna Insurance Group SE again had
the largest share of the pension insu- rance market with 82%. The
market share of SEB Life and Pension Baltic Estonia branch fell
from 19% to 10%, while the market share of ERGO Life Insurance
Estonia branch fell from 12% to 8%.
Receipts of whole life insurance are rising each year and have
doubled over the past six years. Swedbank Life Insurance SE had the
largest market share with 61%, followed by SEB Life and Pension
Baltic SE Estonia branch with 28%.
32
Market share of annuities as the end of 2020 (end of 2019 in
brackets)
SEB Life and Pension Baltic SE Estonia branch 10% (19%)
Compensa Life Vienna Insurance Group 82% (69%)
ERGO Life Insurance Estonia branch 8% (12%)
33
Market share of whole life insurance as the end of 2020 (end of
2019 in brackets)
SEB Life and Pension Baltic SE Estonia branch 28% (27%)
Compensa Life Vienna Insurance Group 2% (2%)
ERGO Life Insurance Estonia branch 6% (5%)
Mandatum Life Insurance Baltic 3% (2%)
Swedbank Life Insurance 61% (64%)
THE ESTONIAN FINANCIAL SERVICES MARKET AS AT 31 DECEMBER 2020
33
8.3 INSURANCE BROKERS INTERMEDIATING LIFE INSURANCE
Insurance premiums intermediated Insurance brokers registered in
Estonia intermediated a total of 860,035 euros of life insurance
premiums in 2020. Although the volume of insurance premiums
intermediated increased by 25% over the year, the amount collected
through brokers remains very small at below 1% of the life
insurance premiums of Estonian insurers.
Insurance brokers mainly intermediated accident and illness
insurance, for a total of 465 thousand euros, and other life
insurance contracts worth 300 thousand euros. The most popular type
of insurance among other life insurance contracts was risk life
insurance. Annuity payments of 95 thousand euros were
intermediated, while no premiums for unit-linked life insurance
were intermediated at all.
The life insurance brokers in Estonia also intermediate a lot of
contracts from insurers in countries of the European Economic Area,
and in 2020 these accounted for 54%, or 466 thousand euros, of the
insurance premiums of brokers, having been 65% or 446 thousand
euros a year earlier.
Market share by insurance premiums (three largest): KindlustusEst
Kindlustusmaakler 29% IIZI Kindlustusmaakler 26% UADBB Aon Baltic
Estonia branch 5% Clients: 786 contracts intermediated Volume of
services: insurance premiums of 860 035 euros were intermediated in
2020
34
Other types
2019 2020
Insurance premiums intermediated through insurance brokers by type
of life insurance (thousand euros)
THE ESTONIAN FINANCIAL SERVICES MARKET AS AT 31 DECEMBER 2020
34
INSURANCE BROKERS There were 11 insurance brokers intermediating
life insurance contracts in 2020.
Because the volume of premiums intermediated is small, the market
shares of life insurance brokers are quite volatile, as each new
contract can affect the market share of its broker substantially.
KindlustusEst Kindlustusmaakler had the largest share in 2020 with
29%. It was followed by IIZI Kindlustusmaakler with market share of
26%, and UADBB Aon Baltic Estonia branch with 25%.
35
Market share of insurance brokers by life insurance premiums
received in 2020 (2019 in brackets)
Other* 3% (5%)
Marsh Kindlustus- maakler 11% (0%)
UADBB MAI Baltics Estonia branch3% (3%)
ABC Kindlustusmaaklerid 3% (0%)
* The market shares of other insurance brokers intermediating life
insurance were: Vagner Insurance Broker AS 1.7%, Pro
Kindlustusmaakler OÜ 1.0%, Kominsur Kindlustusmaakler OÜ 0.6%,
InPro Insurance Brokers OÜ 0.1% and Ultima Kindlustusmaakler OÜ
0.1%.
THE ESTONIAN FINANCIAL SERVICES MARKET AS AT 31 DECEMBER 2020
35
36
Volume of insurance premiums in non-life insurance in 2020 (2019 in
brackets)
Estonian non-life insurers 265 million euros (287)
Branches of foreign non-life insurers 118 million euros (111)
International contracts intermediated in Estonia 35 million euros
(38)
9. THE NON-LIFE INSURANCE MARKET Non-life insurance contracts are
provided in Estonia by insurers registered in Estonia, Estonian
branches of foreign insurers, and foreign insurers operating
internationally. Cross-border services are mainly provided in
Estonia through Estonian insurance brokers.
THE ESTONIAN FINANCIAL SERVICES MARKET AS AT 31 DECEMBER 2020
36
37
Insurance contracts signed through dierent sales channels by
premiums 2020 (2019 in brackets)
Direct sales 52% (50%)
Insurance agents 17% (17%)
Insurance brokers 31% (33%)
9.1 NEW SALES OF NON-LIFE INSURANCE CONTRACTS
30 This amount includes internal group agents.
In 2020, 2,972,932 new insurance contracts were signed in Estonia,
which is just a little fewer than last year, when 3,082,498
contracts were signed. Premiums received under them were 386
million euros in 2020 and 397 million euros in 2019. Insurance
contracts were mainly signed with the insurer or an employee as a
direct sale, and 52% of premiums from new contracts came in this
way. Around 17% of the premiums from new contracts came through
insurance agents30 and 31% came through insurance brokers.
THE ESTONIAN FINANCIAL SERVICES MARKET AS AT 31 DECEMBER 2020
37
9.2 INSURANCE COMPANIES PROVIDING NON-LIFE INSURANCE31
Insurance premiums32
31 Data on non-life insurance cover only contracts signed in
Estonia and do not include contracts signed by branches of Estonian
insurers abroad. 32 The data on insurance premiums and payouts come
from Statistics Estonia. 33 Travel insurance is recorded under
accident and illness insurance.
The Covid-19 crisis that broke out at the start of the year reduced
sales of insurance contracts in Estonia, though the volume of
insurance premiums fell by only 3.7%. Non-life insurance companies
operating in Estonia and branches of foreign non-life insurers
received a total of 383 million euros in insurance premiums in
2020, down from 398 million a year earlier. Estonian branches of
foreign insurers received 31% of all insurance premiums, or 118
million euros.
The three insurance products that were most affected by the crisis
were motor third-party liability insurance, land vehicle insurance
and travel insurance33. Premiums for motor third- party liability
insurance fell from 102 million euros a year earlier to 90 million.
This is also partly because tariffs were cut because of price
competition. Premiums for land vehicle insurance, also known as
Casco insurance, were down from 126 million euros to 119 million.
Premiums for travel insurance fell from 18.6 million euros a year
earlier to 11.7 million.
Insurance premiums increased for other products though, which were
property insurance, financial loss insurance, and other vehicles
and transportable goods insurance. Premiums for health insurance
increased by 0.9 million euros over the year to 2 million euros.
This is a supplementary insurance taken out by employers with the
state health insurance
system on behalf of employees, which may gain further in popularity
because of the ongoing coronavirus pandemic.
The crisis also had some positive impact on the operations of
insurers. The restrictions in the spring reduced traffic volumes
and so the number of cases of loss related to vehicles fell, and
this reduced the need to pay out compensation. Compensation paid
out fell most for land vehicle insurance, for which it declined
from 84 million euros to 80 million, and for motor vehicle
liability insurance, where it fell from 60 million euros to 57
million. Compensation of 214 million euros in total was paid out in
2020, which was 4 million euros less than a year earlier.
Market share by insurance premiums (three largest): IF P&C
Insurance AS 19% Swedbank P&C Insurance 19% ERGO Insurance 18%
Number of contracts: 2,972,932 Volume of services: insurance
premiums of 383 million euros were received in 2020
38
39
60
13
84
2
52
Non-life insurance payouts by type of insurance (million
euros)
THE ESTONIAN FINANCIAL SERVICES MARKET AS AT 31 DECEMBER 2020
38
INSURANCE PROVIDERS The merger of Seesam Insurance and Compensa
Vienna Insurance Group, ADB Estonia branch was carried out in the
second half of 2020, during which the insurance portfolio of Seesam
Insurance was transferred to Compensa Vienna Insurance Group, ADB
Estonia branch. At the end of the year Compensa Vienna Insurance
Group, ADB Estonia branch had a significant part of the non-life
insurance market in Estonia, with 13% of the insurance premiums
received. AS LHV Kindlustus was added to the list of non-life
insurers in the last days of the year, but its market share was
very small.
The biggest insurer was If P&C Insurance, which increased its
market share from 18% to 19% despite the difficult year. Swedbank
P&C Insurance had almost the same market share at around 19%.
ERGO Insurance was one of the few insurers that saw insurance
premiums received increase in 2020, and so its market share grew
from 16% to 18%.
Motor third-party liability insurance premiums were down at almost
all insurers, but to differing extents, and this caused some
changes in the division of the market for that type of insurance.
The biggest decline was in the market share of Inges Kindlustus,
from 8% to 6%. The largest market share in motor third-party
liability insurance was held by ERGO Insurance SE with 20%,
followed by AB Lietuvos draudimas Estonia branch and If P&C
Insurance with 15% each.
40
Market share of non-life insurance premiums received in 2020 (2019
in brackets)
Akciné draudimo bendrové Gjensidige Estonia branch 2% (2%)
Lietuvos draudimas Estonia branch 15% (16%)
BTA Baltic Insurance Company Estonia branch 6% (7%)
ERGO Insurance 18% (16%)
Inges Kindlustus 1% (2%) Other 2% (1%)
Salva Kindlustus 5% (6%)
Compensa Vienna Insurance Group, ADB Estonia branch 13%
(13%*)
* The market share of Compensa Vienna Insurance Group, ADB Estonia
branch in 2019 includes that of Seesam Insurance.
41
Market share for motor third party liability insurance as at the
end of 2020 (end of 2019 in brackets)
Akciné draudimo bendrové Gjensidige Estonia branch 3% (3%)
Lietuvos draudimas Estonia branch 15% (16%)
BTA Baltic Insurance Company Estonia branch 8% (8%)
ERGO Insurance 20% (20%)
Inges Kindlustus 6% (8%)
Salva Kindlustus 8% (7%)
Compensa Vienna Insurance Group, ADB Estonia branch 11%
(11%*)
* Market share for motor third party liability insurance as at the
end of 2020 (end of 2019 in brackets)
THE ESTONIAN FINANCIAL SERVICES MARKET AS AT 31 DECEMBER 2020
39
42
Market share of non-life insurance premiums received in 2020 (2019
in brackets)
Akciné draudimo bendrové Gjensidige Estonia branch 1% (1%)
Lietuvos draudimas Estonia branch 18% (18%)
BTA Baltic Insurance Company Estonia branch 7% (8%)
ERGO Insurance SE 15% (14%)
If P&C Insurance 20% (18%)
Salva Kindlustus 4% (5%)
Swedbank P&C Insurance 21% (22%)
* The market share of Compensa Vienna Insurance Group, ADB Estonia
branch in 2019 includes that of Seesam Insurance.
43
Market share of non-life insurance premiums received in 2020 (2019
in brackets)
Akciné draudimo bendrové Gjensidige Estonia branch 2% (2%)
Lietuvos draudimas Estonia branch 14% (15%)
BTA Baltic Insurance Company Estonia branch 3% (3%)
ERGO Insurance SE 12% (11%)
If P&C Insurance 24% (24%) Salva Kindlustus 5% (7%)
* The market share of Compensa Vienna Insurance Group, ADB Estonia
branch in 2019 includes that of Seesam Insurance.
Swedbank P&C Insurance 20% (20%)
Compensa Vienna Insurance Group UADB Estonia branch 16%
(16%*)
Telia Försäkring Estonia branch 4% (2%)
Insurance premiums for land vehicle insurance were also down at
almost all insurers. Swedbank P&C Insurance with 21% and If
P&C Insurance with 20% had the largest market share.
Receipts of premiums for property insurance varied widely, as they
increased at some insurers, with the biggest increase at Telia
Försäkring AB Estonia branch, while they fell at others, with the
biggest fall at Salva Kindlustus. If P&C Insurance had 24%
market share in property insurance, and Swedbank P&C Insurance
had 20%. Compensa Vienna Insurance Group, ADB Estonia branch was
third with 16% after its merger with Seesam Insurance.
THE ESTONIAN FINANCIAL SERVICES MARKET AS AT 31 DECEMBER 2020
40
9.3 INSURANCE BROKERS INTERMEDIATING NON-LIFE INSURANCE
Insurance premiums intermediated
34 As well as contracts with insurers, contracts with foreign
reinsurers were also intermediated by brokers, but they are not
covered in this review. They received 0.7 million euros in
insurance premiums in 2020.
Insurance brokers registered in Estonia intermediated non-life
insurance premiums of 166 million euros in 202034, which was 10
million euros less than in 2019. The number of contracts
intermediated fell by 67,335 to 731,478.
The largest type of insurance by insurance premiums intermediated
by brokers was insurance for land vehicles, where 45 million euros
of insurance premiums were intermediated, which was 4 million euros
less than in 2019. Insurance premiums of 37 million euros were
intermediated for motor third-party liability insurance, which was
8 million euros less. The third largest type of insurance was
property insurance with 35 million euros of insurance
premiums.
Estonian insurance brokers intermediate contracts from both
Estonian and foreign insurance companies. In 2020, 79% or 131
million euros of all the insurance premiums intermediated were
those of Estonian insurance companies, and 21%, or 35 million
euros, went to foreign insurers. The largest share of the contracts
of foreign insurers were the 16 million euros of insurance for
other vehicles and goods under transport, followed by 10 million
euros of insurance against monetary loss, and 5 million euros of
property insurance. In 2020,
34% of all the non-life insurance premiums taken in by Estonian
insurers came through brokers. The biggest shares of premiums
through brokers were of 79% in insurance for other vehicles,
covering air and water transport, and of 42% in third-party motor
insurance.
Market share by insurance premiums (three largest): IIZI
Kindlustusmaakler 30% Marsh Kindlustusmaakler 16% KindlustusEst
Kindlustusmaakler 6% Clients: 731,478 contracts intermediated
Volume of services: insurance premiums of 166 million euros were
intermediated in 2020
44
45
6
49
21
35
Insurance premiums intermediated through insurance brokers by type
of non-life insurance (million euros)
45
44%
15%
39%
63%
27%
Share of insurance premiums intermediated through insurance brokers
of insurers operating in Estonia
THE ESTONIAN FINANCIAL SERVICES MARKET AS AT 31 DECEMBER 2020
41
46
Market share of insurance brokers by non-life insurance premiums
received in 2020 (2019 in brackets)
Other* 30% (30%)
CHB Kindlustusmaakler 5% (5%) Vandeni Kindlustus- maaklerid 5%
(5%)
Kominsur Kindlustusmaakler 4% (3%)
47
Fix Kindlustusmaakler 3% (3%) Smart Kindlustusmaakler 3% (3%)Marsh
Kindlustusmaakler 3% (2%)
Market share of insurance brokers for motor third-party liability
insurance as at the end of 2020 (end of 2019 in brackets)
48
UADBB Aon Baltic Estonia branch 3% (4%)
Aadel Kindlustusmaaklerid 3% (3%)
Vagner Insurance Broker 3% (4%) ABC Kindlustusmaaklerid 3%
(3%)
Market share of insurance brokers for land vehicle insurance as at
the end of 2020 (end of 2019 in brackets)
INSURANCE BROKERS There were 40 insurance brokers intermediating
non-life insurance contracts in 2020. The majority of the market is
divided between only a few brokers though, as 82% of insurance
premiums were intermediated by 11 insurance brokers. IIZI
Kindlustusmaakler held the largest market share with 30%, followed
by Marsh Kindlustusmaakler with 16% and KindlustusEst
Kindlustusmaakler with 6%.
At the end of 2020 IIZI Kindlustusmaakler had the largest market
share for third-party motor insurance with 58%, followed by
KindlustusEst Kindlustusmaakler with 8% and CHB Kindlustusmaakler
with 4%.
The largest market share for insurance of land vehicles was held by
IIZI Kindlustusmaakler with 42%, followed by KindlustusEst
Kindlustusmaakler with 9% and Smart Kindlustusmaakler with
7%.
* The market shares of other insurance brokers intermediating
non-life insurance were: UADBB Aon Baltic Estonia branch 3.13%,
GrECO Speciality GmbH Estonia branch 3.02%, Vagner Insurance Broker
AS 2.73%, AS Smart Kindlustusmaakler 2.57%, OÜ ABC Kind-
lustusmaaklerid 2.40%, Aadel Kindlustusmaaklerid OÜ 2.31%, Fix
Kindlustusmaakler OÜ 1.98%, Optimal Kindlustusmaakler OÜ 1.51%,
Credo Kindlustusmaaklerid OÜ 1.27%, NB Kindlustusmaakler OÜ 1.23%,
Ultima Kindlustusmaakler OÜ 1.19%, OÜ TIIB Kindlustus- maakler
0.96%, OÜ Kindlustusmaakler Tiina Naur 0.87%, Pro Kindlustusmaakler
OÜ 0.64%, OÜ Marks ja Partnerid Kindlustusmaaklerid 0.50%, UADBB
MAI Baltics Estonia branch 0.46%, Coop Kindlustusmaakler AS 0.45%,
Avor Kindlustusmaakler OÜ 0.38%, Foxtall Kindlustusmaakler OÜ
0.36%, FS Kindlustusmaakler OÜ 0.32%, Lõuna Kindlustusmaakler OÜ
0.29%, 1Kindlustusmaakler OÜ 0.28%, Northern1 Insurance Solutions
Kindlustus- maakler OÜ 0.21%, Clemenc Kindlustusmaakler OÜ 0.21%,
Premium Kindlustusmaakler OÜ 0.14%, AVC Advisory Kindlustusmaakler
OÜ 0.10%, InPro Insurance Brokers OÜ 0.07%, Vector
Kindlustusmaakler OÜ 0.05% AID Kindlustusmaakler OÜ 0.04%, Direct
Kindlus- tusmaakler OÜ 0.03% Advan Kindlustusmaakler OÜ 0.02%,
Allier Kindlustusmaakler OÜ 0.00% and EDRAUDA, UADBB Estonia branch
0.00%.
THE ESTONIAN FINANCIAL SERVICES MARKET AS AT 31 DECEMBER 2020
42
49
IIZI Kindlustusmaakler 17% (18%)
UADBB Aon Baltic Estonia branch 4% (6%)
ABC Kindlustus- maaklerid 4% (3%)
Vandeni Kindlustus- maaklerid 4% (4%)
Aadel Kindlustus- maaklerid 3% (3%)
Vagner Insurance Broker 3% (2%) Fix Kindlustusmaakler 3% (2%)
Market share of insurance brokers for property insurance as at the
end of 2020 (end of 2019 in brackets)
50
Kindlustusmaakler 9% (9%)
Marsh Kindlustus- maakler 6% (4%)
CHB Kindlustus- maakler 6% (3%)
ABC Kindlustus- maaklerid 6% (5%)
Vagner Insurance Broker 6% (4%)
Optimal Kindlustus- maakler 5% (4%)
Aadel Kindlustusmaaklerid 3% (3%) UADBB Aon Baltic Estonia branch
3% (2%)
Market share of insurance brokers for travel insurance as at the
end of 2020 (end of 2019 in brackets)
Table 3. The largest non-life insurance brokers by intermediation
fees received
Broker Market share 2020 2019
IIZI Kindlustusmaakler AS 37% 40% Marsh Kindlustusmaakler AS 9% 9%
KindlustusEst Kindlustusmaakler OÜ 7% 7% CHB Kindlustusmaakler OÜ
6% 6% Kominsur Kindlustusmaakler OÜ 5% 3% AS Vandeni
Kindlustusmaaklerid 4% 4% Vagner Insurance Broker AS 3% 3% AS Smart
Kindlustusmaakler 3% 3% Aadel Kindlustusmaaklerid OÜ 3% 3% OÜ ABC
Kindlustusmaaklerid 3% 3% Marine Insurance Services SIA Estonia
branch 3% 2% UADBB Aon Baltic Estonia branch 2% 3% Fix
Kindlustusmaakler OÜ 2% 2% GrECo Specialty GmbH Estonia branch 2%
1% Optimal Kindlustusmaakler OÜ 2% 2%
The market leader in property insurance was IIZI Kindlustus-
maakler with 31% followed by Marsh Kindlustusmaakler with 17% and
CHB Kindlustusmaakler with 10%.
IIZI Kindlustusmaaklerile also had the largest market share for
travel insurance with 39%, followed by KindlustusEst
Kindlustusmaakler with 9% and Marsh Kindlustusmaakler with
6%.
Non-life insurers received 22.5 million euros in intermediation
fees in 2020, down from 23.5 million euros in 2019, and 89% of
those fees were received by 15 of the 40 insurance brokers.
THE ESTONIAN FINANCIAL SERVICES MARKET AS AT 31 DECEMBER 2020
43
10. PAYMENT SERVICES The Covid-2020 pandemic did not have any
serious impact on the payment services sector in 2020.
Some 342 million euros in payments were intermediated in 2020, down
from 429 million euros a year earlier, and 6.6 million payments
were made in total, down from 7.6 million. The services provided by
Coop Finants AS are no longer classed as payment services from the
second quarter, and so the data from Coop Finants AS are not
recorded in the payment volumes of the sector. As Coop Finants AS
interme- diated a large number of payments, the number of payments
of the whole sector has been reduced.
The largest volume of payments in 2020 was at Maksekeskus, with 71%
of all payments, followed by TavexWise with 16% and Coop Finants
with 5%.
The largest market share by number of payments was held by
Maksekeskus, which intermediated 73% of all payments.
Market share by volume of payments (three largest): Maksekeskus 71%
TavexWise 16% Coop Finants 5% Volume of services: Payments of 342
million euros
70
Market share of payment institutions as at the end of 2020 (end of
2019 in brackets)
Other 2% (1%) Pocopay 2% (2%)
Coop Finants 5% (18%)
69
Volume and number of payments at payment institutions in half
years
Volume of payments Number of payments
0
500
1,000
1,500
2,000
2,500
3,000
3,500
4,000
4,500
0
100
200
300
400
500
600
700
800
900
1,000
2. Deposits
4. Loans issued by creditors
5. Investment and pension funds
6. Payouts from the second pension pillar
7. Management of securities portfolios
8. The life insurance market
9. The non-life insurance market
10. Payment services