Raiffeisen Bank, one of the largest banks in Albania, is suspected of abusing mortgage borrowers by violating the law, having chosen only one company for life insurance, harming the interests of customers.
This was found in an investigation by the Competition Authority into the way second-tier banks select life insurance companies for clients taking out mortgage loans. According to the rules, in these cases life insurance is mandatory.
From the review of the documentation, it results that the behavior of Raiffeisen Bank SHA may constitute a violation of Articles 4 and 9 of Law No. 9121, dated 28.07.2003 “On the Protection of Competition”.
For consumer loans, the bank has signed a contract with Sigal Life, making it the only insurance company where customers could obtain the mandatory policy.
During the investigation period, around 39,000 insurance policies were issued by Sigal Life alone, which has benefited from over 90% of the life insurance market for loans at Raiffeisen Bank. As a result, the bank has collected significant income from commissions received from this company.
In conclusion, the Competition Authority assesses that the behavior of Raiffeisen Bank SHA has limited customer choices and has affected market competition.
The Authority calls on all borrowers who have paid for life insurance with the bank to provide evidence and information on their experience, especially if:
• they were not given the opportunity to freely choose the life insurance company, or
• they had obstacles or obligations imposed by the bank regarding this choice.
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