Loading ...The gross claims paid by Romanian insurance companies in have exceeded 1 billion euro for the first time, up 35 percent (when stated in euros) from 2006. The 2007 insurance market turnover as a share of the gross underwritten premiums, advanced by a mere 32 percent, when stated in euros. Settled claims reached 47 percent of total turnover in 2007, from just 32 percent in 2003.
Thus, 2007 was the 4th consecutive year when claims overgrew gross underwritten premiums.
Thus, 2007 was the 4th consecutive year when claims overgrew gross underwritten premiums.
In 2006, the difference was even steeper: plus 53 percent for claims, when stated in euros, compared with a 33-percent increase in euros for gross underwritten premiums.
The trend of recent years has translated into a continual deterioration of insurers’ technical and financial results. Since 2003, when claims started outpacing premiums, the net result on the insurance market (profits minus losses) has dropped from a net income of 20 million euros to a net loss of 20 million euros in 2006.
Although the Insurance Supervision Board has not released data on insurance market profitability in 2007, based on information disclosed by some insurers, the market is highly likely to have recorded a net loss last year, as well.
The largest insurers on the two segments (general and life insurance) had lower profitability in 2007 than in 2006. Most losses on the market were generated by car insurance policies, insurers say.
Allianz-Tiriac, the largest local general insurer, posted a 2007 operational profit of 11 million euros, similar to the 2006 figures, although the company’s business advanced 17.4 percent from 2006.
ING, the largest local life insurer, reported a 2007 operational profit of just 1 million euro, down 90 percent from 2006. ING officials say the fall is due to the costs sustained for the commencement of the campaign to win contributors to its mandatory and optional pension schemes. ING’s 2007 gross underwritten premiums stood at 149 million euros, up 3 percent from 2006.
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