Audit of Insurance Companies in Ukraine

Abstract

The insurance industry is considered as an integral part of the market economy in terms of accumulation of free funds of consumers of the insurance product and creation of a financial reserve against unforeseen events. The level of increase and decrease in gross insurance premiums, gross insurance payments, net insurance premiums and net insurance payments, the amount of insurance reserves, life insurance reserves, and technical reserves is studied. The analysis of the insurance market made it possible to draw conclusions about its current state. It is proved that audit should serve as an important mechanism for controlling efficiency for insurance companies, as it supports and regulates management processes, in particular, in the field of finance, accounting and risk management. The study proposes to define the place and role of external and internal audit in the system of effective management of an insurance company to utilize the potential of insurance companies and create a positive impact on the financial market of Ukraine. The authors consider the internal audit of insurance companies as a specific area of audit activity, since the financial insolvency of an insurance company affects the interests of a significant number of persons - insurers and insureds. The external audit of insurers is described as one of the methods of protecting the rights of consumers of insurance services and the rights of owners of an insurance company. It is noted that in 2024, a new Insurance Law based on Solvency II requirements came into force, and the National Bank of Ukraine introduced a requirement for an additional audit report on the insurer and approved the procedure for its submission in order to assess the quality of insurance companies' assets. The study suggests ways to improve the efficiency of insurance activities, and also promising research is the development of ways to implement the priority areas of audit during martial law in Ukraine.