Iryna Kondrat

Financial imbalance is the reason of a macroeconomic instability. This study aims at identifying the institutional causes of financial markets imbalance. The authors consider that financial intermediaries in Ukraine work in a speculative market segment carrying out high-risk transactions with the purpose of earning a huge profit. In fact, in Ukraine the role of these institutions in the investment process financing is insignificant. The authors show that soundness of banks along with the ease of access to loans and a low level of confidence in national banking system are the main reasons of instability in financial market in Ukraine. Due to scarcity of financial capacity and refusal to carry out transactions in a high-risk market segments, insurance companies are unable to entirely perform functions of risk redistribution. Competitiveness of Ukrainian financial market remains low with a limited financial services nomenclature and it may be considered to be attractive for potential foreign investors.

Pandemic affects insurance industry both directly, via health shocks, and indirectly, via financial shocks, as well as via shift in the policyholder behavior and distribution channels. The paper contributes to understanding the impact of COVID-19 on the global and Ukrainian insurance market, provides insights into implementing digital measures and technologies for insurers, in response to changes caused or accelerated by pandemic, building the capabilities to survive and exploit the changing market.
A research of the the dynamics of Ukrainian insurance market changes during the quarantine period was conducted, the main tech achievements of leading insurers were investigated. The paper highlights priorities that insurers need to address in the wake of pandemic (distribution destruction, reinvention of the customer experience, cost structure changes, new protection offerings and new revenue pools), deals with different business strategies that insurers can follow to adopt and pivot in the low-touch economy and reveals new opportunities to extend insurers’ protection offerings and establish new sources of revenue emerged with digital transformation.

Acknowledgment
This project was financed by the Ministry of Science and Higher Education of the Republic of Poland as part of the «Regional Initiative of Excellence” Programme for 2019–2022. Project No. 021/RID/2018/19. Total project budget: PLN 11 897 131,40.