Greek insurance market faces climate, digital, regulatory tests
Bank of Greece Governor Yannis Stournaras outlined key challenges for the Greek insurance market, including climate change, digital transformation, and new regulatory frameworks. Speaking in Athens, he emphasized the sector's resilience and the need for robust supervision.
Greek insurance shows resilience
The global economy faces significant challenges, including increased protectionism, geopolitical tensions, and environmental pressures, impacting fiscal sustainability, price stability, and financial stability.
Despite these headwinds, the Greek insurance market has demonstrated resilience, effectively responding to crises like the pandemic, extreme weather events, and the energy crisis, while maintaining a strong capital position.
In 2025, total assets of Greek insurance undertakings reached €22.1 billion, with liabilities at €17.9 billion and own funds at €4.2 billion.
The Solvency Capital Requirement (SCR) coverage ratio stood at 173%, and the Minimum Capital Requirement (MCR) coverage ratio at 474%.
A key long-standing challenge remains the insurance protection gap, particularly critical in Greece due to its high exposure to natural catastrophes like earthquakes, floods, and wildfires, where coverage remains disproportionately low.
Digital shifts and new regulations
The Greek insurance market has undergone significant transformation, including successive mergers and acquisitions, now comprising 31 supervised undertakings.
Beyond structural shifts, the sector faces challenges from digital transformation and cyber risks, with the DORA Regulation, in force since January 2025, imposing strict requirements for digital operational resilience.
Regulatory frameworks are also evolving, with the revised Solvency II Directive, expected to be transposed by January 2027, strengthening proportionality and sustainability.
Concurrently, the Insurance Recovery and Resolution Directive (IRRD) introduces obligations for recovery and resolution plans, enhancing the sector's flexibility and resilience.
A pivotal role, still undervalued
The Greek insurance sector demonstrates robust financial health and adaptability to crises, yet its fundamental contribution to economic resilience remains underutilized due to a persistent protection gap.
While new regulations and digital tools offer avenues for growth and efficiency, the core challenge lies in translating this potential into broader societal coverage.
The Bank of Greece's focus on consumer protection and climate adaptation is therefore crucial for unlocking the sector's full strategic value.