The Montenegrin insurance market is the smallest in the CEE region and given its small population and the modest dimensions of the country, it will never be a large market in terms of volume. But market indicators suggest that this does not mean it is not an interesting market for insurers. The insurance density (annual premiums per capita) is around EUR95, while the insurance penetration (share of the premiums in the GDP in percent) is around 1.8%.

And 2009 results are consistent with this assertion. Montenegro was one of the very few insurance markets across the CEE region that posted a positive GWP growth rate, with a 6% rise on the 2008 figures.

Indeed, the Montenegrin economy as a whole performed better than most of the others in the region. Clearly the 8.1% GDP growth rate seen in 2008 was not possible given the financial crisis, but the 0.6% fall was enviable in the regional context.

Competition in the insurance industry was strengthened in the last two years, with new players entering the market. In 2008 UNIQA entered the Life market through its UNIQA ZIVOTNO osiguranje subsidiary, which continued the operation of ZEPTER osiguranje, and the Non-life sector through UNIQA NEZIVOTNO osiguranje. The same year also saw DELTA osiguranje and DELTA LIFE osiguranje begin operations, and as 2008 closed they became members of the GENERALI Group and added their new parent's name to their title. At the end of 2008, MERKUR Insurance also obtained the licence for Life insurance operations. More recently, in December 2009 ZAVAROVALNICA TRIGLAV finalised the acquisition of the majority stake in the last state-owned financial company, LOVCEN.

Life insurance accounts for 12.5% of market GWP and reported 11.5% growth in 2009, to EUR11.5m. The Non-life market growth of 5.2% came mostly from the MTPL segment, according to market sources.