Loading ...The insurance companies have announced tariff hikes of 15% on average for the mandatory car insurance (RCA) policies for most frequent cars in Romania (with engine capacities of 1,400-1,600 cubic centimeters) but the effective hike may be bigger because the Insurance Supervision Commission (CSA) compels the insurers, as of this year, to make some damages reserves better correlated with the risks.
On the other hand, the insurance brokers say “the right price” for RCA should be at least double versus the current one, given the continuous increase in the price of car repair and spare parts, the Saptamana financiara weekly writes.
“The average price of an RCA policy in Romania stands at some 80 euro per year versus 300 euro per year everywhere else in Europe,” says the CEO of insurance broker SRBA, Gheorghe Grad.
“The average price of an RCA policy in Romania stands at some 80 euro per year versus 300 euro per year everywhere else in Europe,” says the CEO of insurance broker SRBA, Gheorghe Grad.
According to the professional organization of insurers – UNSAR – the under-valuation of the damages reserves represents the main reason of the losses posted by the entire industry in the past years.
In December 2007, CSA issued an order under which the insurers authorized to sell RCA policies were compelled to set up and maintain an additional technical reserve of 60% of the value of the gross premiums sold on the RCA segment. Back then, CSA justified the move through “the need to protect the interests of the insure red.” Afterwards, under the pressure of the market, CSA canceled the respective order.
In December 2007, CSA issued an order under which the insurers authorized to sell RCA policies were compelled to set up and maintain an additional technical reserve of 60% of the value of the gross premiums sold on the RCA segment. Back then, CSA justified the move through “the need to protect the interests of the insure red.” Afterwards, under the pressure of the market, CSA canceled the respective order.
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