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. Last Updated: 07/27/2016

Russia's Top Insurers Get 'Expert' Rating

Expert Ra "separated the best from the best" Russian insurance companies Thursday with the release of the first reliability ratings in the $7 billion-a-year industry.

The ratings, compiled with the help of international accounting major PricewaterhouseCoopers, took Expert Ra three months to compile and ranked the sector's top players based on financial performance and solvency.

Expert Ra chief Dmitry Grishankov told reporters that the methodology used to determine the ratings, which range from A+++ to D, was adapted to "the peculiarities" of Russia. "One of those peculiarities," he added, was the price Expert Ra charged for the rating ? $1,800, which is just a fraction of the $50,000 average charged by international rating agencies.

Of the seven leading insurers who signed up for the pilot project, only one ? Vesta ? refused to disclose its rating.

"It was very hard work for us to choose the best from the best ? all six companies are leaders in the market," Grishankov said.

Three companies ? Voyenno-Strakhovaya Kompaniya, Reso-Garantiya and Rosno ? were rated A++, the second-highest possible score. Neftepolis and Progress-Garant scored A+ and Russian Insurance Center was given A.

"This is the most successful attempt to rate Russian insurers," said Dmitry Izvekov, board chairman of Russian Insurance Center. "All previous ratings were made solely on the basis of gross premium collections and did not reflect companies' financial stability."

To get rated, the companies had to agree to provide a wide range of documents, and Expert Ra had to pledge confidentiality. "These companies didn't give us just a standard bundle of documents," Grishankov said, "they opened up some additional information, some of which were commercial secrets."

Participants in the project said the process helped improve the transparency of the industry.

"Transparency is a new type of competition," said Sergei Tsikalyuk, general director of Voyenno-Strakhovaya. "That's why it is so important to participate in this rating. It stimulates us to improve so next year we won't be ranked worse, which is not easy," he added.

But it may take some time before Expert Ra's ratings are taken seriously.

Erchard Jorchel, managing director of Ost-West Allianz, a subsidiary of German giant Allianz AG, Europe's top insurance company by market value, said that he had not even heard about the new ratings. Allianz AG became the first major foreign player to enter the Russian market this summer when it bought a 45 percent stake in Rosno. "I have not heard of this rating either by friendly or unfriendly competitors," Jorchel said.

One major player with no intention of getting rated is Ingosstrakh. Company spokesman Pavel Solovyov expressed doubt about the thoroughness of the rating. "An analysis of a company is impossible to make on just $1,800," he said.