Western Balkans Insurance Market: Low Penetration, Modest Profits

The insurance market in the Western Balkans remains significantly underdeveloped compared with the European Union. The industry is small relative to the size of the region’s economies, while profitability remains relatively modest.

Ersuin Shehu

The insurance market in the Western Balkans expanded again last year, but the development gap with European Union markets remains substantial.

In 2025, the insurance markets of the six Western Balkan economies generated approximately €3.13 billion in gross written premiums (GWP), an increase of 8.7% compared with the previous year, according to data compiled by Monitor, based on figures published by the respective insurance supervisory authorities.

The industry’s combined pre-tax profit reached €271 million, up 31.6% year-on-year. Nevertheless, profitability remains modest compared with other segments of the financial sector.

The regional insurance market still appears to have considerable untapped potential. Major European insurance groups, such as Generali and Vienna Insurance Group, remain important players across the region. Meanwhile, another major insurer, UNIQA, decided to partially withdraw from the market by selling its subsidiaries in Albania, Kosovo and North Macedonia.

Albania Remains the Region’s Smallest Insurance Market

The underlying indicators confirm that the Western Balkans still lag significantly behind the European Union in insurance market development.

Data for 2025 show that insurance penetration, measured as gross written premiums relative to GDP, ranged from approximately 1% to 2.15% across the six economies. By comparison, the EU average is estimated at around 6.5%.

There are also considerable differences between individual markets within the region.

According to figures from the Albanian Financial Supervisory Authority (AFSA), Albania had the lowest insurance penetration in 2025, at just 1.03% of GDP. This was more than 50% below the level recorded in Kosovo, the region’s second-smallest market by this measure, where penetration stood at 1.57%.

North Macedonia followed at 1.75% of GDP, Serbia at 1.8%, Montenegro at 1.87%, and Bosnia and Herzegovina at 2.15%.

Another important indicator of market development is insurance density, which measures gross written premiums per capita.

Albania also ranked last in the region on this measure, with annual insurance premiums of €104 per person in 2025. Kosovo followed at €108, North Macedonia at €161, Bosnia and Herzegovina at €174, Montenegro at €234, and Serbia at €244 per capita.

Market Structure: Motor Insurance Dominates

The figures show that insurance markets across the Western Balkans are dominated by non-life insurance, particularly motor insurance, which includes compulsory motor third-party liability coverage and comprehensive motor insurance (Casco).

However, motor insurance accounts for considerably different shares of total premiums across individual markets. It represents 40.6% of gross written premiums in Serbia and 43.4% in Montenegro, compared with 70% in Albania and almost 75% in Bosnia and Herzegovina.

The dominance of motor insurance is an indirect indication of the market’s relatively low level of development. Motor insurance is largely compulsory and is often perceived by consumers as a legal obligation rather than a necessary expense to protect themselves against financial risks.

The share of life insurance also varies significantly across the region.

Kosovo has the smallest life insurance segment, accounting for just 4.7% of total premiums, followed by Albania at 9%, North Macedonia at 16.5%, Serbia at 17.8%, Bosnia and Herzegovina at 18.6%, and Montenegro at 20.9%.

Albania Has the Lowest Claims-to-Premiums Ratio

Figures reported by national insurance regulators show that insurers across the Western Balkans paid approximately €1.43 billion in gross claims during 2025.

In absolute terms, Serbia accounted for the largest amount of claims paid, at €776 million, representing 54% of the regional total. Bosnia and Herzegovina ranked second, with €302 million, or 21% of the total.

A simple comparison of gross claims paid with gross written premiums shows that Bosnia and Herzegovina had the highest claims-to-premiums ratio in the region, at 50.3%.

Kosovo followed at 48.3%, Serbia at 47.6%, Montenegro at 44.2%, and North Macedonia at 38.2%.

Albania ranked last, with gross claims paid equivalent to just 31.7% of gross written premiums.

Profit Margins Remain Modest, but Albania Leads the Region

Data reported by insurance supervisory authorities show that the combined pre-tax profit of insurance companies across the Western Balkans reached €271.2 million in 2025, an increase of 31.6% compared with the previous year.

Serbia generated the largest absolute profit, at €129 million. Bosnia and Herzegovina and Albania followed, each reporting approximately €45 million. North Macedonia recorded €22 million, Kosovo €17 million, and Montenegro €14 million.

Nevertheless, insurance does not appear to generate particularly high profit margins compared with other segments of the financial sector, particularly banking.

In the absence of comprehensive financial data for insurance markets across the region, profitability can be assessed using the ratio of pre-tax profit to gross written premiums, which represent the main source of revenue for insurance companies.

On average, this ratio stood at 8.67% across the Western Balkans in 2025, improving from 7.17% a year earlier. If the calculation were based on insurers’ total revenues rather than gross written premiums alone, the resulting profit margin would be lower.

However, profitability varies considerably between individual markets.

In 2025, Albania recorded the highest ratio of pre-tax profit to gross written premiums, at 16%. Kosovo ranked second at 9.6%, followed by Montenegro at 9.4%, Serbia at 7.9%, Bosnia and Herzegovina at 7.6%, and North Macedonia at 7.4%.

Albania: €280 Million Insurance Market Led by Sigal

Albania’s insurance market generated €280 million in gross written premiums in 2025, an increase of 12.15% compared with the previous year.

Historically, Albania’s insurance market has been dominated by compulsory motor insurance products. The market comprises 13 insurance companies, eight licensed to provide non-life insurance and five operating in the life insurance segment.

In 2025, Sigal Insurance Group led the market with €64.6 million in gross written premiums, accounting for 23.1% of the total. It was followed by Sigma Vienna Insurance Group, with €48.4 million (17.4% market share), and Albsig, with €35 million (12.5%).

Among life insurers, Albsig Jetë ranked first, generating €9.7 million in gross written premiums, equivalent to 3.5% of the overall insurance market.

The industry’s total pre-tax profit reached €44.7 million in 2025, up 58.8% year-on-year. Eleven insurance companies reported profits, while two ended the year with losses.

Sigal Insurance Group was the most profitable insurer, with pre-tax earnings of €15.2 million, followed by Eurosig at €9.6 million and Albsig at €4.7 million.

Kosovo: €179 Million Insurance Market Led by Sigal

Kosovo’s insurance market recorded €179 million in gross written premiums in 2025, representing growth of 6.6% compared with the previous year.

The market comprises 12 insurance companies, including 10 licensed to provide non-life insurance and two operating in the life insurance segment.

Sigal, part of Albania’s Sigal Insurance Group, was the market leader in 2025, with €23.7 million in gross written premiums and a market share of 13.3%.

It was followed by Sava, part of the Slovenian insurance group, with €22.4 million (12.5%), and locally owned Scardian, with €21.6 million (12.1%).

Among the two life insurance companies, Sava Life was the largest, with €4.6 million in gross written premiums, accounting for 2.6% of the overall insurance market.

The insurance industry generated a combined pre-tax profit of €17.2 million in 2025, broadly unchanged from 2024. All insurance companies operating in the market ended the year profitably.

Sigal Insurance Group also topped the profitability ranking, with pre-tax earnings of €3.5 million. Scardian followed with €3.1 million, while another locally owned insurer, Prisig, ranked third with €3 million.

Serbia: €1.6 Billion Insurance Market Led by Dunav

Serbia has by far the largest insurance market in the Western Balkans, with gross written premiums reaching €1.63 billion in 2025, an increase of 7.7% compared with the previous year.

The Serbian market comprises 16 insurance companies. Unlike most other countries in the region, Serbia and Bosnia and Herzegovina do not require insurers to be licensed exclusively for either life or non-life insurance.

In Serbia, 10 companies are licensed to provide life insurance, although only three operate exclusively in this segment.

The insurance market is led by domestically owned Dunav, which generated €426 million in gross written premiums, accounting for 26.1% of the market. The Serbian government controls approximately 77% of the company’s shares.

Generali, part of the Italian insurance group, ranked second with €302 million in premiums and an 18.5% market share. It was followed by DDOR, part of Italy’s Unipol Group, with €171 million, representing 10.5% of the market.

The Serbian insurance industry generated approximately €129 million in pre-tax profits in 2025, an increase of 40.5% year-on-year. Thirteen insurers reported profits, while three recorded losses.

Generali was the most profitable insurer, earning €40.4 million before tax. Dunav followed with €34.3 million, while DDOR ranked third with €17.6 million.

Montenegro: €148 Million Insurance Market Led by Lovćen Triglav

Montenegro’s insurance market generated €148 million in gross written premiums in 2025, up 10.5% compared with the previous year.

Nine insurance companies operate in the market, including five non-life insurers and four life insurers.

Lovćen, part of Slovenia’s Triglav Group, was the largest insurer by gross written premiums, generating €41 million and accounting for 27.8% of the market.

Another Slovenian-owned insurer, Sava, ranked second with €26.1 million (17.6%), followed by UNIQA, part of the Austrian insurance group, with €23.7 million (16%).

Among life insurance companies, Wiener Life Vienna Insurance Group ranked first, with €14.3 million in premiums, representing 9.6% of the overall market.

The Montenegrin insurance industry recorded a combined pre-tax profit of €13.9 million in 2025, a decline of 4% compared with the previous year. Eight companies reported profits, while one ended the year with a loss.

Lovćen also led the profitability ranking, with €4.2 million in pre-tax earnings, followed by Sava at €3.3 million. Grawe Life and Generali each recorded profits of €1.7 million.

North Macedonia: €289 Million Insurance Market Led by Makedonija VIG

North Macedonia’s insurance market reached €289 million in gross written premiums in 2025, an increase of 12.3% compared with 2024.

The market comprises 17 insurance companies, including 11 non-life insurers and six life insurers.

Makedonija Vienna Insurance Group was the largest individual insurer by gross written premiums, generating €36.8 million and accounting for 12.7% of the market.

It was followed by the North Macedonian subsidiary of Slovenia’s Triglav Group, with €34.5 million (11.9%), and the local subsidiary of Sigal Insurance Group, with €30.1 million (10.4%).

However, at group level, the market is led by Austria’s Grawe Group. Its three insurance companies — Grawe, Grawe Life and Eurolink — generated combined gross written premiums of €48.4 million, equivalent to 16.7% of the market.

Among life insurers, Croatian-owned Croatia Life ranked first, with €15.1 million in premiums and a 5.2% share of the overall market.

North Macedonia’s insurance industry recorded a combined pre-tax profit of €21.5 million in 2025, up 56.3% year-on-year. Fifteen insurance companies ended the year profitably, while two reported losses.

Eurolink, part of Austria’s Grawe Group, was the most profitable insurer, with €2.75 million in pre-tax earnings. It was followed by Bulgarian-owned Euroins at €2.7 million and Sigal Insurance Group at €2.6 million.

Federation of Bosnia and Herzegovina: €424 Million Insurance Market Led by ASA Central

The Federation of Bosnia and Herzegovina had the second-largest insurance market in the Western Balkans in 2025, with gross written premiums reaching €424 million, an increase of 10.5% compared with the previous year.

As in Serbia, insurance companies in Bosnia and Herzegovina are not required to be licensed exclusively for either life or non-life insurance. Ten insurance companies operate in the Federation, of which Vienna VIG is exclusively engaged in life insurance.

In 2025, locally owned ASA Central was the largest insurer in the Federation of Bosnia and Herzegovina, with gross written premiums of €75.3 million, accounting for 17.8% of the market.

It was followed by two Croatian-owned insurers belonging to the Euroherc/Agram Group: Adriatic, with €62.7 million (14.8% market share), and Euroherc, with €51.2 million (12.1%).

The Federation’s insurance industry generated a combined pre-tax profit of €23.9 million in 2025, up 10.2% year-on-year. All insurance companies ended the year profitably.

Euroherc was the most profitable insurer, with pre-tax earnings of €5 million, followed by ASA Central at €4.3 million and Adriatic at €4.1 million.

Republika Srpska: €174 Million Insurance Market Led by Wiener VIG

The insurance market in Republika Srpska, one of Bosnia and Herzegovina’s two entities, generated €174 million in gross written premiums in 2025, representing an increase of 4.1% compared with the previous year.

The market comprised 13 licensed insurance companies.

Wiener Vienna Insurance Group was the largest insurer in 2025, with gross written premiums of €27.8 million and a market share of 16%.

It was followed by another Austrian-owned insurer, Grawe, with €21.8 million (12.5%), and locally owned Premium, with €12.7 million (10.7%).

The insurance industry in Republika Srpska generated a combined pre-tax profit of €21.5 million in 2025, an increase of 11% year-on-year. All insurance companies operating in the market reported profits.

Locally owned Nešković was the most profitable insurer, with pre-tax earnings of €5.7 million. It was followed by two other domestically owned insurers, Garant, with €4.2 million, and Drina, with €3.2 million.

The 10 Largest Insurance Groups in the Western Balkans

The Western Balkans insurance market is highly concentrated among major regional insurance groups. Approximately 73% of total gross written premiums (GWP) are generated by the region’s 10 largest insurance groups.

Serbia’s state-controlled Dunav is the largest insurance group in the region, largely reflecting its dominant position in Serbia, the Western Balkans’ biggest insurance market. In 2025, Dunav generated €445 million in gross written premiums, the vast majority of which came from Serbia, where it is the market leader. Dunav also operates in Republika Srpska, Bosnia and Herzegovina, where it ranks fourth.

Vienna Insurance Group (VIG) ranks second, with €353 million in gross written premiums. VIG operates across all six Western Balkan economies, with particularly strong positions in North Macedonia and Republika Srpska, where it leads the respective markets. It also ranks second in Albania through its subsidiaries Sigma and Intersig.

Italy’s Generali ranks third, with €317 million in gross written premiums. Most of its business comes from Serbia, where it is the second-largest insurer. Generali also operates in Montenegro, where it ranks fourth.

Slovenia’s Triglav Group ranks fourth, with €262 million in gross written premiums and an extensive regional presence. It leads the Montenegrin market, ranks second in North Macedonia, and holds fifth place in both Serbia and the Federation of Bosnia and Herzegovina.

Austria’s Grawe Group ranks fifth, with more than €187 million in gross written premiums. It is the largest insurance group in North Macedonia and also operates in Serbia, Montenegro, the Federation of Bosnia and Herzegovina and Republika Srpska.

Italy’s Unipol Group ranks sixth, with €171 million in gross written premiums. Unlike most other leading groups, Unipol operates in the Western Balkans exclusively through its Serbian subsidiary, DDOR Novi Sad.

Slovenia’s Sava Group ranks seventh, with €137 million in gross written premiums. It has particularly strong market positions in Kosovo and Montenegro, where it ranks second through its Sava and Sava Life subsidiaries. The group is also present in Serbia and North Macedonia.

Albania’s Sigal Insurance Group ranks eighth, with €136 million in gross written premiums. Sigal leads the insurance markets in Albania and Kosovo, while ranking fifth in North Macedonia.

Austria’s UNIQA Group ranks ninth, with €134 million in gross written premiums. Following the sale of its stake in Sigal Insurance Group, UNIQA has reduced its presence in the regional market. Nevertheless, it continues to operate in Serbia, Montenegro and Bosnia and Herzegovina.

Croatia Insurance Group completes the top 10, with €123.3 million in gross written premiums. The group operates in Serbia, North Macedonia and the Federation of Bosnia and Herzegovina.

The ranking of the region’s 10 largest insurance groups by pre-tax profit is led by Generali, with €42.1 million, followed by Dunav at €33.4 million and Sigal Insurance Group at €25.7 million.

The combined ratio of pre-tax profit to gross written premiums for the 10 largest groups stood at 8.1% in 2025, slightly below the regional average of 8.7%.

Sigal Insurance Group recorded the highest pre-tax profit-to-premiums ratio, at 18.9%, followed by Generali at 13.3%, Unipol at 10.3%, Grawe at 9.3%, Dunav at 7.5%, Croatia Insurance Group at 7.4%, Sava at 7.3%, Triglav at 6.1%, and VIG at 3.5%.

UNIQA was the only group among the top 10 to report a negative ratio, at -0.2%.

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TABELA E MADHE TE SHEET RENDITJA TOTAL SIPAS PRIMEVE

Ranking of Insurance Companies in Western Balkans by Gross Written Premiums (€ million)