According to statistics from the Ministry of Labor and Social Protection of Kazakhstan, with a record volume of pension payments amounting to 3.75 trillion tenge, there is a growing interest in alternative pension provision tools. As reported by the National Bank of Kazakhstan, the volume of premiums for pension annuity insurance increased by 337.6% in 2024, reaching 457.1 billion tenge. This is highlighted in a study by Freedom Life Insurance Company.
Current State of the Pension System
The number of pensioners in Kazakhstan stands at 2 million 445 thousand. The average total pension amount is 143,248 tenge, which includes a basic pension of 47,459 tenge and a solidarity pension of 95,789 tenge, according to the study.
Analysts note that at the beginning of 2025, the basic pension increased by 6.5% in line with inflation, while the solidarity pension saw an increase of 8.5%, outpacing inflation by 2%. "The increase in the minimum basic pension to 70% of the subsistence minimum, and the maximum to 120% has been particularly significant," the study states.
Transformation of Pension Preferences
An analysis of the insurance market structure has revealed radical changes in the preferences of Kazakhstani citizens. Pension annuity insurance has taken a dominant position, accounting for 46.8% of total premiums with a year-on-year growth of 20.1% (described in the study as "impressive").
Factors Driving the Growth of the Pension Annuity Market
The growth of the pension annuity market in 2024 is attributed to a complex of interrelated factors, according to analysts.
One such factor is termed the "significant influence" of demographic trends. "Kazakhstan is experiencing a steady trend of increasing life expectancy: according to statistics, the average life expectancy in the country has reached 75.9 years. Moreover, the share of citizens of pre-retirement age (50-60 years) now exceeds 15% of the population. This age group shows the greatest interest in pension annuities, particularly in the opportunity for earlier retirement," the study notes.
Other factors include macroeconomic conditions (high volatility in financial markets and inflation risks) and the technological transformation of the financial sector (the digitization of contracting and servicing processes has significantly simplified access to pension products). In 2024, the procedure for transferring savings from the Unified Accumulation Pension Fund (UAPF) to insurance companies for pension annuity contracts was optimized, the researchers remind. According to the new regulations, contributors can enter into a pension annuity contract directly at the insurers' offices and online on the insurance company's website, without having to apply to the UAPF for transferring their pension savings to the insurance company.
Another important factor contributing to the growth of the pension annuity market, according to analysts, is the increase in financial literacy among the population.
Market Development Forecasts Until 2030
In the next two years, further growth in the share of pension annuities is expected in Kazakhstan—up to 55-60% of the life insurance market, with total premiums increasing to 500-550 billion tenge, according to the study's authors. They believe this period will be characterized by the active development of new product solutions and intensified competition among key players.
By 2027-2028, the market is likely to stabilize at around 600-650 billion tenge. "During this period, sustainable consumer preferences are expected to form, as well as the potential emergence of specialized pension products for various professional groups amid further digitization," the analysts write.
In 2029-2030, "integration with international financial markets, development of cross-border pension products, and implementation of artificial intelligence technologies in pension asset management can be anticipated." By this time, the study states, the market volume could reach 800-850 billion tenge.