Even in Croatia, the post-liberalization fall in tariffs seems to slow down and some marginal hikes in tariffs have been witnessed in the first half of 2016.
Thus, in most CEE countries both the Motor Hull and MTPL lines have recorded a positive dynamic. Hungary and Romania saw the highest growth rates, of almost 33% and 28% respectively, both of them reporting also significant increases in MTPL tariffs. In fact, the increasing MTPL insurance prices, especially for the corporate carriers, almost sparked a "street war", needing the market authority's intervention and leading to extensive changes in the MTPL legislation.
Turkey has also experienced a record high raise in MTPL tariffs which have, in fact, doubled as compared with the previous year. As a result, market GWP for this line of business went up by 125% in national currency, increasing car sales having this time a little say in the business volume growth.
Yet, both the CEE and the Turkish MTPL markets remain rather competitive and challenging. Steps taken towards digitalization and a more customer centric approach may shift the competition from the aggressive price war to improving quality of services or value added components to raise customer's retention. Pressure put by the Solvency II requirements on insurers' capital, legal changes in distribution brought by the IDD, consumer protection issues and a more demanding supervising have the potential to add to the already challenging character of the motor insurance business in the region.
IIF 2017 first motor insurance conference, to be held in Vienna, on February 15 under the titles "New challenges for the CEE motor insurance industry" will address all the above issues in an event enriched by top quality speakers.
First details about the event are already available on the conference's website.