Romania maintains its leading position in Europe in terms of accidents resulting in material damage and/or bodily harm compensated on the basis of Civil Auto Liability (RCA) policies, informs on Wednesday the National Union of Insurance and Reinsurance Companies of Romania (UNSAR).
Thus, the frequency of RCA damages in Romania, meaning the ratio between the number of claims and that of policies issued, is one of the highest at the European level, according to data collected by UNSAR from several national insurers' associations in Europe.
According to the quoted source, in Romania, the average frequency of claims stands at around 6%, according to the most recent data provided by the Financial Oversight Authority (ASF).
"This means that in Romania, each year, out of 100 registered vehicles, at least 6 produce traffic accidents resulting in material damage or bodily harm and death - a very high number compared to other countries. Comparatively, Germany recorded at the end of 2020 a frequency of claims of 4.4%, Italy - 4.2%, Bulgaria - 3.82%, Poland - 3.69%, Slovakia - 3.35%, Czechia - 2.73% or Finland -1.8%. Not by chance, Romania is at the top of the European rankings in what regards the damage rate, another indicator specific to the insurance industry, with a level of over 80% in 2020, while the European average stood at 62%, according to a report recently published by EIOPA - the European Insurance and Occupational Pensions Authority. Moreover, after the first nine months of 2021, the damage rate in the RCA insurance area rose to 99.52% - shows the ASF data," the release mentions.
The UNSAR representatives claim that this damage rate is compounded by functioning taxes, tariffs paid, contributions to the Insured Guarantee Fund, the National Protection Fund, as well as distribution and administration costs, utilities' costs - which are all in accelerated growth.
"In all, all these figures form a combined technical rate of over 130%. This shows that the basic activity of an insurer, that of subscription (therefore taking on some risks), is generating losses," the release also shows.
UNSAR is showing, in short, that the RCA line is not profitable for insurance companies: for each 100 RON earned on an RCA, the insurers need to pay an extra 30 RON.
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