“Insurance on the rise, but the market remains concentrated”/ AFSA: Compulsory insurance accounts for 61.8% of the total. Non-life also dominates
The insurance market in Albania is experiencing steady growth, but remains heavily dependent on compulsory motor insurance. The latest data from the Financial Supervisory Authority shows that for the period January-September 2025, gross written premiums reached 20 billion lek, an increase of 10.4% compared to the same period last year. The number of contracts signed also increased by 6.2%, reaching 1.2 million.
However, behind this growth lies a well-known reality, the dominance of mandatory insurance, which accounts for 61.8% of the total market. In contrast, voluntary insurance accounts for only 38.2%, indicating that awareness of insurance as a personal choice remains limited.
Non-Life Insurance accounts for 91.7% of the total premium volume, and the largest share of this category is attributed to motor insurance, which is mandatory by law. This segment not only dominates the market, but also keeps it growing, making it dependent on a committed customer base.
The implementation of the bonus-malus scheme since January 2025 has brought a new dimension to this dependency. The scheme penalizes drivers with a history of accidents and rewards those with safe behavior, directly affecting insurance prices. However, because 2025 is considered a “zero accident” year, the real effects of this scheme will only be felt in 2026, when prices will be determined based on the new risk history.
While the growth in revenues and contracts is a positive signal, the market structure remains one-sided. Life insurance accounts for only 8.27% of the total, while reinsurance is almost non-existent at 0.033%. This shows that the market development is not happening in a balanced way, but is mainly based on a single segment — that of compulsory motor insurance.
The challenge ahead is to develop an insurance culture that goes beyond legal obligation, encouraging citizens to invest in voluntary protection for their lives, health, and wealth.
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