Kazakhstan unveils plan to expand pension annuities and auto insurance by 2030
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Kazakhstan's financial regulator has announced a draft insurance market development program through 2030 that would expand pension annuity options and introduce risk-based auto insurance pricing. The program, developed with market participants, proposes three new pension annuity products and a shift to individualized motor insurance premiums. The initiative also includes simplified licensing for foreign insurers and new mandatory earthquake coverage for housing.
Key Facts
- The draft program proposes three new pension annuity products: guaranteed, unit-linked, and hybrid annuities.
- As of early 2026, the number of active pension annuity contracts in Kazakhstan reached 164,294, with total premiums of 1,168 billion tenge.
- The program would allow auto insurers to calculate premiums using individual driver risk factors such as driving history, traffic violations, age, and vehicle mileage.
- Foreign insurers with a credit rating of at least 'A-' would be eligible for a simplified licensing procedure, and the current $5 billion minimum asset requirement for branches may be reduced.
- The program also proposes introducing mandatory earthquake insurance for housing as part of a unified model for compulsory insurance.
Pension Annuity Expansion
The draft program, developed by the Agency for Regulation and Development of the Financial Market (ARDFM) on the instruction of the Head of State, proposes to expand the range of pension annuity products available to citizens. Currently, Kazakhstanis have access to immediate, deferred, and joint (spousal) pension annuities that provide lifetime insurance payments. The program introduces a guaranteed annuity as the base product, which ensures lifetime payments and transfers longevity risk to the insurance company. A new unit-linked annuity would combine pension protection with investment income, with returns depending on the performance of a chosen investment portfolio or market index. A hybrid annuity would split funds into two parts: one providing guaranteed lifetime payments and the other invested for additional income.
Auto Insurance Reform
The program proposes to replace the current uniform approach to mandatory auto insurance with risk-based pricing that accounts for individual driver and vehicle characteristics. Insurers would be allowed to use their own scoring systems, drawing on data from the Unified Insurance Database and government information systems. Factors that may be considered include loss history, driving style, traffic violations, age and driving experience, vehicle mileage, operating mode, and region of use. The reform aims to make premiums fairer, with careful drivers paying less and high-risk drivers paying more, while also improving transparency in claims settlement.
Market Liberalization
The program includes measures to liberalize entry conditions for foreign insurance companies into the Kazakhstani market. Deputy Chairman of ARDFM Nurzhan Tursunkhanov announced at a roundtable in Almaty that the minimum asset threshold for foreign insurers opening branches may be reduced from the current $5 billion. The program also proposes eliminating the requirement for foreign insurers to have 10 years of experience in all insurance classes. Additionally, the program suggests transitioning to a unified model for compulsory insurance, with basic rules set by law and variable parameters determined by subordinate acts.
17 sources
Kazakhstan unveils plan to expand pension annuities and auto insurance by 2030
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