News
Life insurance companies of ERGO Insurance Group in the Baltic States merge into the European Company
2010-02-12
With a view to further extending the range of highest quality life insurance services and guaranteeing adequate volumes of life insurance services for customers in all Baltic States, life insurance companies of ERGO Insurance Group in Estonia, Latvia and Lithuania are merged into one European Company ERGO Life Insurance SE. Its head office will be set up in Lithuania and branches – in Latvia and Estonia. Completion of merger is envisaged by Q3 2010.
“In the first instance these developments will offer new opportunities for customers. The greatest benefits of the merger of life insurance companies will be experienced in particular by those customers who need insurance solutions in all Baltic States. Life insurance products of equally high quality and with lowest costs tailored to meet market needs in Estonia, Latvia and Lithuania are among the main goals of this merger”, – says Dr. Kęstutis Bagdonavičius, Chairman of the Board of ERGO Insurance Group in the Baltic States.
According to the Board Chairman Dr. K. Bagdonavičius, customers can also expect new initiatives favourable to them in the area of servicing. Meanwhile for employees the setting up of the European Company opens the possibilities for personal development in the multicultural team and participation in the international mobility projects in all Baltic countries.
The merger of life insurance companies is a consequential part of the process of integration of ERGO companies in the Baltic countries. The merger will facilitate in creating an effective and high quality business structure, optimising work processes, effectively reallocating human and capital resources, consolidating positions of ERGO Insurance Group in the Baltic region, at the same time enhancing its competitive advantage. This is the first case in the Baltic countries when the process of merger is implemented in the insurance group which is the only insurance company offering full range of non-life, life, health insurance and pension funds’ services, rather than focusing its business on one branch of insurance, likewise the great majority of other market participants.
ERGO Life Insurance SE will be set up after merger of the life insurance companies ERGO Lietuva gyvybės draudimas AB (Lithuania), ERGO Latvija Dzīvība“ AAS (Latvia) and ERGO Elukindlustuse AS (Estonia). Conditions of insurance contracts for the existing customers will remain the same and they will not have to sign new insurance contracts.
“The times when our business was limited by state boundaries are already history. Today we are the participants of the insurance system functioning on the basis of modern principles, which is rapidly developing and conforms to the international standards. The future of the Baltic insurance market will depend upon growing international competition which undoubtedly will stimulate modernisation of insurance companies. The setting up of the European Company is a strategically important step in this direction which will also help to act professionally and with the focus on the long-term business development perspective“, –- says Dr. K. Bagdonavičius.
The decision on the merger of life insurance companies was adopted by Supervisory Board of ERGO Insurance Group in 2008. The new company will have the status of the European Company (Societas Europaea (SE). Since 2004 the setting up of the European Companies is possible in all territory of EU. Their registration and operation is governed by the same rules applicable all over EU.
ERGO Life Insurance SE head office will be set up in Lihuania (Vilnius) and its branches – in Estonia and Latvia. Lithuania was selected because of its valuable experience in the area of life insurance and size of the existing portfolio of customers. ERGO non-life insurance companies in the Baltic States will retain the same legal status.
ERGO Insurance Group in the Baltic States
ERGO is one of the largest insurance groups in the Baltic States, operating in the areas of life, non-life, health insurance and pension funds in Estonia, Latvia and Lithuania. ERGO services more than 400 000 of customers in the Baltic States and is one of the largest insurance companies in this region.
In the Baltic States ERGO includes three life insurance and three non-life insurance companies. Life insurance companies to be merged by Q3 2010 include ERGO Elukindlustuse AS (Estonia), ERGO Latvija Dzīvība AAS (Latvia) and ERGO Lietuva gyvybės draudimas AB (Lithuania). Three non-life insurance companies ERGO Kindlustuse AS (Estonia), ERGO Latvija AAS (Latvia) and ERGO Lietuva UADB (Lithuania) and pension funds management company ERGO Funds AS (Estonia) will retain the same legal status.