Premium
After H1 2022, Romania's market for the RCA motor third-party liability insurance confirms having managed to overcome the effects of the City Insurance SA, a former leading RCA insurer, having left the market, according to data with the Financial Oversight Authority (ASF).
"The efficiency of the unprecedented measures taken by the Financial Oversight Authority (ASF), both in terms of legislation and in terms of control and oversight, is confirmed by the preliminary data reported by insurance companies for the first six months of 2022," according to ASF.
Market concentration, they say, although still high, reached the lowest level in the last eight years.
"After having grown substantially after the exit of City Insurance SA, in the second quarter of this year Euroins, the current leader of the RCA market, returned to the level of the similar period of 2021 in terms of market share, dropping to 31.8%, in June 2022, from 36% in late March 2022."
Correlated with the developments in other companies authorised to sell RCA, the dynamics of the market share of the largest players suggests that the insurance deficit created by the exit of City Insurance SA was covered in a balanced way by the entire market, without the appearance of distortions that would up to alarming levels the market share of a single player.
Moreover, that can also be seen from the report on payments made by the eight active players in H1 2022.
"Euroins has a share of over 50% in the gross claim payments. Euroins' behaviour is also the result of the actions of the Financial Oversight Authority (ASF), which was active through permanent oversight and control, sometimes resulting in levying penalties," says ASF.
The ranking of the first three players, based on Gross Written Premiums (GWP), is rounded up by Groupama, with a market share of almost 21%, and Allianz Tiriac with almost 19%, with the two companies performing almost flatly in the second quarter of 2022.
"With the exception of Generali, all the other companies owns between 6% and 8% of the market, worth noting being the position of Axeria Yard, a French company which in June was approaching 6% of the market, although it entered Romania only in December 2021."
ASF data show that the average premiums stabilised and even entered a downward trend in Q2 2022, with the average premium for individuals reaching 904 lei at the end of June, as against 913 RON at the end of March.
"A gratifying development can also be observed in terms of quotes. Average premiums levelled out and even entered a downward trend in Q2 2022, according to data with ASF. Average premiums for individuals was 904 RON at the end of June, as against 913 RON at the end of March. For legal entities, the average premiums remained approximately at the same level of 1,984 RON, as against 1,943 RON in March."
According to ASF, compared with the first part of 2021, the increases are still substantial, but the stabilisation and even a slight decrease in premiums for individuals are positive signs that show that the diversification of the market has tangible results.
Indicators also improved in terms of claims history. The combined rate reached 107%, down from over 112% at the end of Q1 2022, over 142% in Q2 2021 and over 161% at the end of 2021.
According to ASF, premium commissions paid by insurers for the distribution of RCA fell to 10.72% in H1 2022, from 14.40% in H1 2021.
At the same time, the loss ratio plummeted to 74.85% in Q2 2022 from 109.15% in Q2 2021, which shows that the insurers substantially reduced their losses.
The Financial Oversight Authority (ASF) is the national authority of Romania for the regulation and oversight of the insurance markets, private pensions, as well as the capital market. ASF contributes to the consolidation of the integrated operating framework of the three players, which have more than 10 million participants combined. AGERPRES
