The FINANCIAL — Vienna Insurance Group (VIG), the leading Insurer in CEE (Central and Eastern Europe), states that the recent accusation of the Georgian Labour Party (GLP) of International Insurance Company IRAO, is a subject of political conflict.
VIG holds 90% of shares at IRAO. VIG’s representative asserts that the operations of IRAO are regularly monitored, excluding the possibility of embezzlement.
“As in all our insurance companies, the professional business conduct in IRAO is monitored as part of the overall management responsibility. In line with our communication strategy, we do not comment on any political conflicts. The Vienna Insurance Group (VIG), with its 50 insurance companies, including IRAO in Georgia, is known for professional and transparent business execution. We work for the benefit of the customers in all of the countries where we operate, in Central and Eastern Europe,” notes Barbara Hagen-Grötschnig, Head of Group Communications of VIG.
As Kakha Dzagania, one of the leaders of GLP, mentioned, people below the poverty line who participate in the state programme and are IRAO’s insurance-policy holders can’t use their policies in any of the clinics.
“The GEL 140 million provided from the state budget is transferred to their pockets, instead of using it for the medical services of the people insured. Insurance Company IRAO, which is owned by Saakashvili’s brother, has to transfer this money so that clients receive medical service. Currently none of the clinics are accepting the insurance policies of IRAO,” claims Dzagania.
GLP accuses IRAO of stealing GEL 140 million from the state budget, targeted for medical insurance programmes. As the GLP leader says the funds equal to GEL 140 million provided by the state budget have been stolen by IRAO and President Saakashvili’s brother.
“We deny that IRAO doesn’t transfer insurance funds to clinics for the patient’s service costs. There’s a Mediation Centre in partnership with U.S Development Agency that holds full information on the complaints about insurance companies. Anyone interested can check out this information and they will find out that there are the least number of complaints in the Mediation Centre of IRAO,” says Nino Potrzhebskaya, Public Relations Manager of IRAO.
International Insurance Company IRAO claims that the GLP is misleading the public by announcing that IRAO is engaged in a fraud. GLP leaders declared that the money provided by the state budget for the programmes is misused and the people who are insured at IRAO with this programme can’t receive the medical service at clinics.
“IRAO is and was a financially transparent company that operated according to European standards. The financial data of IRAO is available at Insurance Supervision Agency. VIG just recently increased its ownership in IRAO from 51% to 90%. The other 10% belongs to the General Director of the company. Information about the stake ownership is available for anyone at the Georgian Enterprise Register Agency. Our main priority is satisfying our client’s needs and exceeding their expectations,” explains Potrzhebskaya.
“The market potential of Georgia in general is very interesting for VIG. We believe that the Georgian market is safe and strong enough to keep expanding in. Despite the war the Georgian economy is fast developing and stable. Our goal is to always grow faster than the market. IRAO shows very interesting growth potential, the management from our point of view is performing very well. The premiums attracted by the company in 2007 equalled USD 10,923,776. In 2008 this amount increased to USD 13,950,637. We have used this opportunity and decided to increase our shares,” Christoph Wolf, Member of the Board of Executive Directors of TBIH, told The FINANCIAL.
Hospital service of the accused insurer includes organization of hospital services, compensation of the charges for urgent and/or planned hospital services which the insured shall pay in addition to the guarantees provided for under the State Health Programme.
2006 USD 4,551,402 (GEL 6,435,682)
2007 USD 10,878,969 (GEL 15,382,862)
2008 Q1 USD 13,969,070 (GEL19,752,265)
Net incomes in 2007 and 2008:
2007 USD 324,206 (GEL 458,428)
2008 Q1-2 USD 623,730 (GEL 881,955)
“As for the participation of IRAO in state programmes, when they’re talking about misusing the funds from the state budget, GLP doesn’t really have the right information about this matter. Nearly every insurance company that is big enough on the local market is taking part in state programmes. Our overall share of engagement in the state programmes is 10%. The project is being monitored by international organizations and corresponding monitor agencies,” notes Potrzhebskaya.
According to Nino Potrzhebskaya this irresponsible campaign of accusations is staining the image of the company and whole insurance sector. Plus it is provoking untrustworthiness in the public putting more pressure on the already difficult financial situation in the country. As she says medical insurance is a guarantor of social security of the public in the world’s developed countries.
Written By Levan Lomtadze