The liquidation of personal life insurance policies reached a record-high level of 260 million euros in the first quarter of the year, according to the Hellenic Association of Insurance Companies (EAEE). This compares with a total of 815.5 million euros in early liquidations for 2015 as a whole, or an average of less than 204 million euros per quarter.
EAEE reports that the sum insurers paid out to clients who cashed in their contracts early is twice what they paid for mature policies and other payouts, which in the first quarter of the year came to 106.8 million euros.
The money disbursed by the country’s insurance firms in the January-March period came to 450.6 million euros for personal policies, plus 82.6 million euros in compensation paid out to people insured through group policies. This takes the sum paid out far above the premiums collected in the same period, which reached 486.2 million euros.
The reasons for the high number of broken policies are the reduction in households’ disposable income and increased tax obligations, which prevent them from meeting their contract obligations. The situation was exacerbated by the imposition of capital controls in June 2015.