Albania’s leading banks were placed under in-depth investigation on Wednesday by the Competition Authority on suspicion of violating Articles 4 and 9 of the Law “On the Protection of Competition”, the Competition Authority announced in a press release.

The investigation concerns brokerage practices for the sale of a life insurance policy, which banks require certain borrowers, including home loan borrowers. This insurance policy is intended to guarantee that an insurance company will pay the loan if the borrower dies without repaying it. This is a product that, according to data from the Financial Supervisory Authority, generates gross income for insurance companies of Lek 1.64 billion (about Euro 16 million).

Article 4 of the Law on Protection of Competition prohibits two or more operators in the same market from entering into agreements with each other to restrict competition, for example, by setting the same prices, limiting quantities, or imposing other restrictive criteria on the consumer.

Article 9 of the law prohibits companies that are considered to have dominant market power from abusing this dominant power.

"The Competition Authority opens an in-depth investigation procedure in the life insurance intermediation market for loans that require life insurance for enterprises: OTP Bank Albania SHA, Banka Kombëtare Tregtare SHA, Credins Bank SHA, Raiffeisen Bank SHA, Banka e Tiranës SHA, Intesa Sanpaolo Bank Albania SHA, Union Bank SHA, E-Business Solutions SHPK, United Bank of Albania SHA, American Investment Bank SHA and Abi Broker Sigurimesh SHA and in the life insurance lending market for loans granted within the bank to Banka e Pare e Investimeve SHA and Banka Procredit SHA," the authority's announcement states.

“The conduct of the companies Raiffeisen Bank SHA, OTP Bank Albania SHA, Banka Kombëtare Tregtare SHA, Tirana Bank SHA, Intesa SanPaolo Bank Albania SHA, Union Bank SHA, E-Business Solutions SHPK, ABI Bank SHA, Abi Broker Sigurimesh SHA, and Procredit Bank SHA may constitute a violation of Article 4 and Article 9 of Law No. 9121/2003, while the conduct of the companies Tirana Bank SHA, Credins Bank SHA, United Bank of Albania SHA and First Investment Bank SHA may constitute a violation of Article 9 of Law No. 9121/2003,” the announcement further states.

Debtor life insurance is an insurance product that is sold to borrowers on a mandatory basis, for the banks’ security for the repayment of the loan in the event of the creditor’s death. Around 118,000 Albanians purchased such an insurance policy in 2024, according to data from the Financial Supervisory Authority (AFSA). The number of customers of this insurance class and the income of insurance companies from these sales have increased dramatically in recent years.

AFSA data shows that the number of Albanians who have been forced to purchase a debtor's life insurance policy has doubled, from 59,000 people in 2019 to 118,000 in 2024. Income from the sale of insurance policies of this class has increased by 112%, which means that the average price of the policy sold has also increased. Claims paid by insurance companies in 2024 were only 10% of the premiums paid. This means that insurance companies enjoy a gross profit rate of 90% for this product, a figure that suggests a low level of competition in the market to the detriment of consumers.