Will the Earthquake Fund be the largest insurance company? - It is expected to collect over 30 million euros per year for 1 million insured homes
The National Fund for Mandatory Housing Insurance against Earthquakes and Floods, which will be established soon, is expected to become one of the largest financial mechanisms in the insurance market in Albania, with annual revenues that could exceed 3 billion lek or 30 million euros per year.
According to an analysis by SCAN TV, according to the 2023 Census, there are a total of 1,082,529 homes in Albania that will be included in the mandatory insurance scheme, of which 726,325 are occupied homes and 356,204 are unoccupied homes. The rumored annual premium for each home is expected to average around 30 euros, although there is still no final figure.
But if we were to make a calculation based on this premium level, the Fund would generate about 32.5 million euros per year, or approximately 3.25 billion lekë. Excluding here the buildings of state institutions which will also have earthquake insurance as an obligation. Also excluded from this figure are the revenues that will be collected from the premium that will be set for floods, because the risk areas and the number of apartments that will be part of the scheme have not yet been determined.
If we were to make a comparison with mandatory vehicle insurance, MTPL, from this insurance policy, companies have generated around 14.3 billion lek in revenue or around 143 million euros in 2025, remaining the largest product in the insurance market in Albania.
In relative terms, the Housing Fund would represent about 23% of the financial volume of MTPL.
However, unlike MTPL, which is divided among several private insurance companies, the Housing Insurance Fund will function as a single entity and state-owned company, where 100% of premiums will be concentrated in a single institution.
So in other words, although it will not be the largest market in volume, the Fund is expected to become the largest individual institution in the insurance sector in Albania, due to the very broad base of contributors, the mandatory nature of payment, and the stability and predictability of income.
If there is no major earthquake, the Fund could accumulate over 30 billion lek in capital within a decade, becoming a player with real weight not only in insurance, but also in the financial system as a whole.
The creation of the Fund marks a significant change in the philosophy of risk management in Albania, from the model of compensation after disasters through state budget money, towards a permanent financial mechanism for asset protection.
In macroeconomic terms, the Fund is expected to play a key role in reducing the fiscal burden on the state budget in the event of future earthquakes but also floods, by shifting the cost from public financing towards a structured and sustainable insurance scheme.
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