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Criticism of Kazakhstan’s Health Insurance System Reaches Parliament

Members of Kazakhstan's Mazhilis (lower house of parliament) have voiced strong criticism of the country’s healthcare system, particularly the Social Health Insurance Fund, which they argue has lost public trust. Many citizens reportedly view the quality of medical services as unsatisfactory. Kazakhstan operates a system of compulsory social medical insurance, wherein doctors' services are funded through a combination of contributions from working citizens, their employers, and the state budget. These financial contributions are collected by the Social Health Insurance Fund, which then allocates the funds to medical institutions based on the volume of services provided to the population. Speaking in Parliament, Health Minister Akmaral Alnazarova defended the system, claiming that it has led to improvements in key health and demographic indicators since its introduction. “Today, 83% of Kazakhstanis are connected to the compulsory social health insurance system, 72% of whom are from vulnerable segments of the population. This demonstrates the availability of medical care in the country,” Alnazarova stated. However, Mazhilis Deputy Chairman Dania Yespayeva pointed out that despite increasing healthcare budgets, public satisfaction with medical services continues to decline. According to surveys, up to 47% of Kazakhstanis consider the quality of domestic healthcare to be poor. Deputy Askhat Aimagambetov echoed these concerns, accusing medical institutions of manipulating service statistics to secure additional funding from the Social Health Insurance Fund. He cited a case where a five-month-old child, who had not yet developed teeth, was recorded as having received dental services. Aimagambetov also claimed that hospitals sometimes charge the insurance fund for dozens of services provided to the same patient in a single day - an impossibility. “The financing system encourages such behavior because payments are based on the quantity of services rendered, not on the effectiveness of treatment. As a result, the [Social Health Insurance Fund] has become a de facto bank for the Ministry of Health. Citizens and doctors alike have become hostages of inconsistent and poorly planned reforms, while the availability and quality of care have deteriorated. The system remains underfunded, and the resources it does have are spent inefficiently,” Aimagambetov stated. He emphasized the need for stricter oversight of the reports submitted by medical institutions to the insurance fund for reimbursement. Currently, inspections cover only about 1% of these reports, a figure Aimagambetov described as insufficient. Public dissatisfaction with health care is also reflected in broader trends. As previously reported by The Times of Central Asia, approximately 5% of Kazakhstanis considering emigration cite access to better medical services abroad as a primary reason.

Legislation Insurance Government vehicles

Kyrgyz Authorities Postpone Fines for Lack of Compulsory Car Insurance

The Cabinet of Ministers of Kyrgyzstan has announced another postponement of fines for motorists without a Compulsory Motor Liability Insurance Policy (CMLIP). Initially set to take effect on January 1, 2025, the penalties will now be delayed until July 1. This is not the first time the implementation of this regulation has been deferred. Authorities concluded that citizens need clearer information about the requirements for mandatory auto insurance. “Currently, changes have been initiated to allow the CMLIP policy to automatically transfer to the new owner of the car when it is sold, which will greatly simplify the insurance process for citizens. We strongly recommend car owners issue a policy in advance to avoid penalties and ensure the protection of their liability on the roads,” stated the Cabinet’s official message. Under the amended law, individuals who fail to secure a CMLIP will face fines of KGS 3,000 ($35), while legal entities will be fined KGS 13,000 ($150). Notably, fines for legal entities have been enforceable since spring 2023. As previously reported by The Times of Central Asia, every motorist in Kyrgyzstan is required to purchase an insurance policy when re-registering a vehicle. However, compliance remains a significant challenge. Despite efforts by the State Insurance Organization to promote compulsory insurance - including warnings about fines - results have been underwhelming. Only around 100,000 vehicles in Kyrgyzstan are insured, out of the 1.6 million cars registered in the country. The Cabinet’s decision to delay penalties aims to provide additional time for public awareness campaigns and to address logistical issues, such as enabling automatic policy transfers during vehicle sales. Officials hope these measures will encourage more motorists to comply with the law before fines are enforced in mid-2025.

householder safety Natural Disaster Threat Insurance Housing Banking

By End of Year, Kyrgyz Authorities Want to Insure All Houses in the Country

The Chairman of the Kyrgyzstan Cabinet of Ministers, Akylbek Japarov, instructed specialized government agencies to ensure the safety of all houses in the country, especially those in mudflow-prone areas. At the meeting devoted to natural disaster risk management, Japarov assigned specialized government agencies to ensure the safety of all houses in Kyrgyzstan. Thus, according to the head of the Cabinet of Ministers, the authorities will provide financial protection to citizens in case of natural disasters. This year, powerful mudslides flooded the south of Kyrgyzstan and the Issyk-Kul region. Over 5,000 households, dozens of social facilities, and hundreds of kilometers of roads were damaged. “Insurance will provide financial protection for citizens in such situations and minimize the consequences for families who lost their homes. Insurance will be an important tool to help people recover faster from natural disasters and reduce the burden on the state budget,” Japarov said. The head of the Cabinet emphasized that due to global warming, the number of natural disasters will continue to grow. Compulsory home insurance will ensure protection for citizens. It should be noted that the law on compulsory real estate insurance came into force in Kyrgyzstan on August 26, 2024. According to the law, residents must insure their real estate against fire and natural disasters. The State Insurance Organization (SIO) explained to The Times of Central Asia that legislative changes would be implemented gradually. The law on compulsory home insurance was first adopted in 2016, but the authorities postponed its implementation. There is no system of fines for lack of such insurance, at least not yet. “It is not profitable for private firms to engage in home insurance, as the rate is only 0.12%. That is, the cost of insurance is KGS 600 ($8), while payouts can be multi-million: KGS 500,000 ($6,000) for a village and KGS 1 mln ($12,000) for a city. Today in Kyrgyzstan, 143 thousand residences are insured,” the SIO noted.

Insurance Legislation Economy Society Quality of Life

Kyrgyzstan Introduces Law on Compulsory Home and Car Insurance

From September 2024, when re-registering cars, owners must provide a contract on compulsory civil liability insurance. The same applies to real estate. The law was adopted eight years ago, but has been delayed under public pressure. According to the State Insurance Organisation (SIO), the introductory amount of car insurance is 1,680 KGS ($20). The final amount will be affected by driving experience, driver age, and engine displacement. The legal department of the State Insurance Organization explained to The Times of Central Asia that a vehicle's insurance policy will be required when it is re-registered with the state authorities. “Employees of the State Insurance Organization are at the places of registration of motor vehicles throughout the country and will issue MTPL insurance policies on the spot. The average amount of MTPL insurance for passenger cars will range from 2,000 to 4,000 KGS ($25-45),” said Ulukbek Nishonov, head of the legal department of the State Insurance Organization. Fifteen private insurance organizations will also insure cars. The law on compulsory car insurance in Kyrgyzstan was adopted more than eight years ago. Nevertheless, no sanctions have been imposed for non-compliance with the law. Most Kyrgyz motorists considered compulsory insurance a “waste of money.” Now, the authorities have figured out how to force everyone to insure their cars, even those without insurance policies or car registration. At the same time, ordinary citizens will not be fined for the lack of insurance. Officials claim that compulsory insurance is a social project. It is worth noting that the law on compulsory real estate insurance also came into force on August 26, 2024. Here, just as in the case of car insurance, citizens will be obliged to insure their property against fire and natural disasters only when re-registering housing. In other cases, it can be done voluntarily. At the same time, the state holds a monopoly on residential property insurance.

Finance Insurance Economy

Kazakhstan Insurers Sign Partnership with Warren Buffett’s Company

Nomad Insurance, a company from Kazakhstan, has announced a strategic partnership with Berkshire Hathaway Specialty Insurance (BHSI), which is part of the Berkshire Hathaway holding company headed by legendary American investor, businessman and philanthropist, Warren Buffett. "BHSI, a giant in the insurance and reinsurance industry with a turnover of more than $74.6 billion, is known for its measured and cautious approach to partner selection. The company enters into partnership agreements with only one insurance partner in each of the 178 countries where it operates. This event is especially significant due to the personality of Warren Buffett, who is the chairman and CEO of Berkshire Hathaway," Nomad Insurance stated. As representative of the company, Shakir Iminov noted, this is a landmark event for Kazakhstan's insurance market, which speaks about its growing attractiveness to international investors.

Insurance Legislation Central Asia Kyrgyzstan

Kyrgyz Authorities Seeking Monopoly on Insurance, Industry Group Says

The Kyrgyz Association of Insurers is sounding the alarm that private insurance companies may soon be out of work due to government interference. According to a decree signed by Kyrgyz President Sadyr Japarov, all state bodies and local governments are now instructed to insure all their property with the State Insurance Organization (JSC SIO) in order to develop the national insurance market. "The Cabinet of Ministers of the Kyrgyz Republic will define JSC SIO as the national operator for reinsurance, including export risks, within the framework of cooperation with the Eurasian Reinsurance Company," the document says. The Kyrgyz Association of Insurers appealed to human rights activists to assist in protecting their interests. Private insurers are sure that the new law violates their rights and doesn't comply with Kyrgyzstan's current legislation. "According to insurers, the principles of entrepreneurial activity established by the legislation of the country, such as non-interference of state bodies in the activities of business entities, are violated. In addition, the state guarantees for the protection of the rights of entrepreneurs equal rights and opportunities to access financial resources -- as well as the creation of conditions for the protection and development of competition -- are being violated," - said the International Business Council, which was engaged by Kyrgyz private insurance companies on the matter. The current law "On Organization of Insurance in the Kyrgyz Republic" prohibits interference in insurance activities. Private insurance brokers and business owners argue that the state is playing an unfair game at the legislative level, forcing state-owned companies to insure their property with the SIO. Besides, the financial means to underwrite risk and pay out possible insurance claims are miniscule to the capitalization of private insurers. Last year, the authorities increased the capitalization of the SSO to 1 billion som, and this year they will allocate another 300 million som by presidential decree. "In the prescribed manner by 2027 to find and gradually allocate funds in the amount of 5 billion som to JSC "SIO" to increase the authorized capital... By 2027, the annual profit in the amount of 100 percent, received from the activities of JSC "SIO," will be directed to increase the authorized capital at the expense of the distribution of budget revenues and expenditures," the law reads. Today, 15 insurance companies, including SSS -- as well as several Chinese and Kazakhstani insurers -- operate in the Kyrgyz market. People familiar with the situation who spoke to The Times of Central Asia say most of the major national companies are already insured with SIO, meaning that only civil insurance lines -- like health and life -- and auto insurance remain for private insurers.