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XPRIMM News - THE ROMANIAN INSURANCE MARKET NEWSLETTER
No. 97, November 22nd, 2007

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EDITORIAL


The Magic Screwdriver


The screwdriver, as it is known, is just a tool, nor good or bad. Improperly used it can hurt, but if it is correctly, then it could be a useful object - all depends on the skills of the person that handles it.

Half of the insurers from the cities visited inside the XPRIMM National Coverage Program have appreciated that The Law on Mandatory Dwellings Insurance (MDI) will result in a decrease of sales in the property insurance.

At the same time, the other half saluted this initiative and was waiting for it, in order to promote the facultative insurance.

This is the way in which the companies that manage private pensions funds, who said to themselves:
"What are we going to do after 17 January 2007, with the huge sales force for the 2nd Pillar? Maybe we should use it to sell MDI?"

In the end of this editorial, I ask my self: why do the insurers have to hurt themselves with the MDI Law, which better or worse will be voted by the Parliament due to its social protection character, by dropping the sales, when they can use it in order to promote the facultative policies?

That is why, until the law will be adopted, let's ask ourselves how we can use more efficient the MDI magic screwdriver…

by sergiu.costache@mxp.ro

sus up

MUNICH Re
WILLIS

BCR Asigurari de Viata
ASIBAN
ASIGEST

ASIGEST Agri

MICROSOFT
OMNIASIG Asigurari de Viata
ARDAF
ASIBAN
FADATA
EDITORIAL | INTERVIEW | TOP PRESS | CEE, RUSSIA & CIS | FINANCIAL NEWS
INTERVIEW

Interview with Mr. Aurel GUBANDRU,
President,
Committee for Budget, Finance and Banks of the Chamber of Deputies

XPRIMM: You are the President of the Committee for Budget, Finance and Banks; committee directly related to the establishment and development of two most dynamic and important financial markets in Romania: insurances and private pensions. Aside from the legislative process, how can support the Committee the development of these markets?
Aurel GUBANDRU:
Aside from the legislative process, and I mean its main attribution of adopting laws, the Committee for Budget, Finance and Banks is obliged to support the development of the two markets, on the one hand taking into consideration any proposal, initiative of legislation's modification or completion as to adapt the legal regulations to the actual conditions of the practice and on the other hand collaborating with the regulatory and supervisory administrative authorities: Insurance Supervisory Commission and Private Pensions System Supervisory Commission. These institutions are under the control of Parliament, which continually monitories the aspects related to both the surveillance of the two markets and the improvement of mechanisms for the good function of the insurance system and private pensions.

XPRIMM: It's obvious that most of the time the problem of these markets regard a pronounced technical aspect which needs professional consultancy. In this direction, how would you characterize the Committee's collaboration with the representatives of both markets, both as supervisory authorities and professional associations of the operators?
A. G.:
As I have mentioned before, one can talk about a very good collaboration with the representatives of both coordination and supervisory authorities of the markets, they being good mediators in the relation of the legislator with the market, respectively in the relation of the Committee's members, as specialists less experienced in the mentioned markets, with the professional associations of the operators.
I stress the last aspect because it consists in collaboration of the parties and communication and negotiation as to meet the parties' interests, inclusive of the citizens and as to fulfill their objectives. That's why for example in my official position I took part at the debate meeting called "Dialog and solutions for the insurances' development in South - East region", held in September at Mamaia. The event was organized by the Insurance Supervisory Commission and brought together representatives of the insurance market, of professional associations, respectively National Association of Insurance and Reinsurance Companies in Romania and the National Union of Insurance Brokerage and Consultancy Societies from Romania, of Parliament, of local public administration and of the businesses in the South - East region. Also, I attended the second Edition of the National Conference of Private Pensions, organized with the support and participation of Supervisory Commission of Private Pension Scheme, which facilitated the dialog between authorities, employers and main operators on private pensions market.

XPRIMM: Your intervention in the Chamber of Deputies highlighted the constant preoccupation for the way natural disasters have affected in the last years the citizens' lives of the county that you represent, Buzau. You have mentioned continually the inefficiency of the government help for the reconstruction of houses and the way agriculture had to suffer. In this context, which is your opinion on the project of reducing the exposure to catastrophic risks and especially on the compulsory dwelling insurances law? Do you believe these laws can contribute to solving the problems related to the post - event finance of reconstruction?
A. G.:
As it is known, Romania is one of the European countries frequently exposed to natural disasters, like earthquakes, flooding and landfall. As these natural phenomena become more severe, involving extremely high post - event costs, reconstruction. I believe that a law regarding the compulsory dwelling insurances is necessary. I strongly sustain this especially because lately these natural disasters occur more frequently, causing real difficulties to governors in helping citizens, affected zones in condition of the risks of happening new events. Obviously, Buzau makes no exception. Moreover, if one considers the compulsory dwelling insurances regulation against natural disasters, it must tackled from two contradictory perspectives: on the one hand, citizens with lower incomes, who don't have the financial means to insure their dwellings and on the other hand the operators who believe that the sums that cover the insurance are too small. I consider we shall find the optimum solutions; we shall succeed in making the post - event solution more efficient.

XPRIMM: You have repeatedly referred in the Parliament debates to the social health system, mentioning its lack of efficiency and the low quality services offered to the population. Do you consider private health insurance would represent a viable alternative, at a large scale? If so, is the Parliament a body that could allot a substantial support to this industry for it to get clear of the difficulties from the beginning of this demarche?
A. G.:
The Parliament can offer this industry the necessary support, but the Government or the professional associations will have to initiate a normative paper draft with regard to the private health insurance. In this case we also speak about a political option because unlike private pensions where money can be used by beneficiaries over 25-30 years old since the first subscription, the private health insurance customers continuously and urgently need the money, when they get sick and must be hospitalized or when they need medicine.

XPRIMM: For 2004 only, households insurance has been fiscally deductible. Although the period when this measure was applied in order to encourage insurance was much too short for causing significant effects in the industry, the signals were positive. Thus, the public interest for protecting one's property through insurance grew and we could assume that on a medium term it could have led to a considerable growth of the penetration rate for this type of insurance. Compared to the conditions envisaged for implementing mandatory insurance, the facultative system seems to be much more interesting for property owners in the urban area, to whom insurers could offer cover for many more risks at a bigger insured sum, applicable to the higher value of household in these areas. Do you think it would be both suitable and possible to reintroduce this kind of incentive for encouraging facultative property insurance?
A. G.:
As people with low budgets can hardly pay for property insurance, the fiscal deductibility for households insurance, after the 2004 model, could be a solution for facultative insurance. Indeed, households from the urban area have a bigger value, therefore insurance is more expensive but they can be insured against fire, earthquakes and floods and the fiscal deductibility could answer to this problem. I think deductibility for household insurance can be reinforced in Romania in 2008.

XPRIMM: Speaking about life insurance, in mature insurance markets the fiscal facilities offered for these products have been the primary growth engine for an activity segment which today contributes with over 60% to the European insurance industry turnover. Although most of these facilities have been drew back, life insurance culture viewed both as a protection and saving instrument, is already strengthened, while life insurance markets continue to report a growth rate above that posted for general insurance.
Taking into consideration, on the one side, the massive contribution insurance companies have to these states' budgets and, on the other one, the social benefits determined by the protection and personal savings brought by insurance, the initial budgetary effort could be considered as an efficient investment. Do you think Romania could adopt such a politic in order to sustain both the development of this industry and a responsible economic behavior among population?
A. G.:
The fiscal facilities offered for buying life insurance could be a very important factor in stimulating development for an economic segment, indeed. Unfortunately, I don't think Romania is now prepared, financially speaking, to create fiscal facilities for life insurance. I see life insurance as a saving instrument whilst the possibility and the arguments to subsidize such a product are very thin. The population isn't ready yet, it does not have a proper economic behavior. Maybe after 5-6 years…I hope so!

XPRIMM: In an intervention you had in June 2007 at the "World Environment Day" you have declared that "as students are involved into this sort of actions, we have a guarantee that after a few years, the ones who will deal with the environment quality will be many more and more responsible". Do you believe a similar approach of educating the youth in the financial field from primary school would be advisable for creating a financial-economic culture for the Romanian population, so that the companies in the field would address to an informed audience, more pretentious and able to administrate their own financial resources with more discernment?
A. G.:
Unfortunately, our youth is not trained from early school in the economic-financial field, regarding the ways one could administrate their own funds. This situation is conducted mostly by two issues: those who provide or should provide this training haven't been themselves prepared in this direction; secondly, there are still many children with very little money allocated. We have to militate for having teachers but also disciplines to train students in this matter so that tomorrow, when they will dispose of more financial resources, they will be having an economic culture as to invest more efficiently.

XPRIMM: Thank you!

by daniela.ghetu@mxp.ro

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Aurel GUBANDRU
Mr. Aurel GUBANDRU,
President,
Committee for Budget, Finance and Banks of the Chamber of Deputies

Competitive Distribution Strategies For The Insurance Sector MEDICOVER
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TOP PRESS

EUR 1.6 billion in 9 months
At the end of the third quarter of 2007, the volume of gross written premiums for the entire Romanian insurance market was RON 5.3 billion, meaning over EUR 1.6 billion, calculated at an average exchange course of 3.3 RON/EUR, the Insurance Supervisory Commission announced during the workshop "New realities and regulations for insurance market in 2008". As structure, 80.65% represent general insurances, while life insurance was only 19.35%.
Within January - September 2007, the gross written premiums on general insurances' segment grew with 24.22% comparing to the similar interval of 2006. Among the general insurances classes, the highest weight was obtained by the third class - insurances for terrestrial means of transport other than rail representing 44.5% out of the total premiums. In exchange, the most important dynamics had the 15th class-credits and warranties insurances, with 94.5% more than the similar interval of 2006.
On life insurances' segment, the increase rhythm was 26.39%.
At the entire market, the gross paid indemnities had a positive evolution, at the end of the third quarter of 2007 the modification rhythm being 31.35% compared to the analyzed period of 2006.
by mihaela.circu@mxp.ro, 15.11.2007


EUR 10 billion for Romanian insurance market in the next 7 years
The development potential of insurance market is far from being reached.
"We estimate that in the next 7-8 years the amount of gross written premiums on Romanian insurance market will totalize EUR 10 billion, comparing to EUR 2 billion forecasted for the end of this year", Varujan VOSGANIAN, Finance and Economy Minister, stated during the a workshop organized by Insurance Supervisory Commission on 15th of November 2007.
This evolution will be determined by the development of life insurances, health insurances and of technology.
At the end of the third quarter of 2007, the volume of gross written premiums was RON 5.3 billion, meaning over EUR 1.6 billion at an average exchange course of 3.3 RON/EUR. As structure, 80.65% represent general insurances and life insurances only 19.35%.
by mihaela.circu@mxp.ro, 16.11.2007


EUR 257 million written premiums for ALLIANZ-TIRIAC
According to the Group's report made public on 9th of November 2007, ALLIANZ-TIRIAC wrote over EUR 84 million gross premiums during the third quarter of the current year. The nominal increase in European currency is 6.32% compared to similar period of 2006.
In the first 9 months of 2007, the company's written premiums reach EUR 257 million, up with 19.53% than the analyzed period of last year.
In the third quarter of 2007, the company's profit is EUR 3 million, while it registered EUR 3 million in the third quarter of 2006. In the first 9 months of the current year the insurer obtained EUR 7 million profit.
The damages have had a positive evolution. So, at the end of the September 2007 the loss ratio was 82% than 76.7% in 2006. Between July and September 2007, the indicator registered 92.3% compared to 68.1% in 2006.
Also, the technical combined rate had a positive dynamics reaching almost 100%.
by mihaela.circu@mxp.ro, 12.11.2007


VIENNA Insurance, majority shareholder of ASIROM
On 7th of November 2007, VIENNA Insurance Group purchased 20.18% shares of ASIROM. Thus, VIG holds more than 50.2% of the Romanian company, after it acquired 30% shares in July 2007.
The transaction's value on RASDAQ is EUR 29 million. The purchase happened at a share price of RON 0.75, almost 4% less than the reference price.
"This acquisition will bring significant benefits to VIG due to the accelerated growth of the Romanian insurance market", Gunter GEYER, CEO of the Group, has mentioned.
At the end of October, VIG obtained the approval of the Competition Council for the Romanian insurer's purchase. According to the Romanian legislation, the Austrian Group has to make in the next two months a public acquisition offer for the rest of shares.
In the first half of 2007, the insurer wrote an amount of RON 337.12 million gross premiums in comparison to the RON 334.33 million in the similar period of 2006.
by alexandru.ciuncan@mxp.ro, 8.11.2007


The assets of voluntary pension in Romania - EUR 1 million
According to data recently released by Supervisory Commission of Private Pension Scheme, the assets under the management of voluntary pension fund have almost reached EUR 1 million.
With small exception, the unitary value of the net assets of the privately administrated pension funds grew around 0.1%. As regards the participants' number and the net assets, the first place is occupied by AZT Moderato fund, with 8,600 participants and over RON 1.3 million assets. The most significant enhance of the contributors, in absolute value, was obtained by the high risk voluntary pension fund, AZT Vivace, with 342 participants more in the last week. In all, almost 22,500 persons have already opted for a voluntary pension fund. Out of this number, 81% have chosen a medium investment risk pension fund, while 17% showed interest in a high investment risk, subscribing to AZT Vivace, the only high risk pension fund.
The operators' top reveals that ALLIANZ-TIRIAC Private Pensions has the biggest volume of assets under management, of over EUR 0.5 million, while ING Asigurari de Viata is on the second place with around EUR 333 thousands. Both operators account for 85% of the voluntary private pensions.
At present, in Romania there are 6 operators on the voluntary pension fund and 7 voluntary pension funds.
by daniela.ghetu@mxp.ro, 16.11.2007


Amicable constat, promulgated
The normative act containing modifications and completions of Law no. 136/1995 regarding insurance and reinsurance in Romania was promulgated last week by the Romanian President, Traian BASESCU.
The changes brought by the law concern the amicable constat in case of road accidents resulting in damages.
Hence, these kind of road accidents can be announced to insurers through a standard form called "accident amicable ascertain", containing the accident's circumstances, the identity personal data of the cars involved in the accident and also of the insurers.
Also, it's important to know that the fulfillment of the ascertain minute by the Road Police remains in force. Thus, the involved parties can opt for one of these forms. The regulation's date for coming into force will be settle by the Insurance Supervisory Commission.
"At present, the Insurance Supervisory Commission is about to finish establishing the form, dimension, content and procedures to be followed of the amicable ascertain", Marius BULUGEA, General Manager in the Compulsory Insurance Department of Insurance Supervisory Commission stated during a seminar organized by the supervisory authority.
The representatives of Road Police congratulate this measure destined to relieve the less severe accidents ascertain activity of the police bureaus.
"This way, we will be able to appropriate more resources to the accidents' prevention taking into account that Romania is the country with the most significant number of victims of road accidents", Gheorghe POPA, General Inspector of Romanian Police declared.
The insurers are not so optimistic. "The amiable ascertain will determine more costs for insurers", Florentina ALMAJANU, General Manager of National Association of Insurance and Reinsurance Companies from Romania emphasized.
by mihaela.circu@mxp.ro, 20.11.2007


Romanian motor insurances market - EUR 921 million in 9 months
Motor insurances continue to dominate the profile market, representing over 71% of the non - life market after the first 9 months of 2007. Thus, from the total of EUR 1.29 billion general insurance, written premiums on motor segment reached EUR 921 million according to data released by Insurance Supervisory Commission.
As regards motor third party liability insurances (MTPL), they account for 36% of the motor insurances.
Compared to the similar period of last year, MTPL registered a 45% increase, respectively EUR 332 million.
"Both the increase number of signed contracts and the bigger tariffs, the average premium registered within this period being RON 248, influenced the amount of premiums", Constantin BUZOIANU, Vicepresident of Insurance Supervisory Commission has stated.
The number of MTPL policies registered in CEDAM database at early October was 3.32 million, 2% more than the same period of 2006 (3.26 million).
"I ask the insurance companies to make all the effort as to grow the operability of data' registration in CEDAM and accuracy of information in 2008", the quoted official added.
In the same time, the first 9 months of the current year means a EUR 260 million claims (paid claims and reserves) on MTPL segment, with 51% more than the 9 months of 2006.
This situation was determined both by the positive evolution of registered events (221,066 files, compared to 190,397 in 2006) and by the growth of average claim (RON 2,190 than RON 2,043).
by mihaela.circu@mxp.ro, 16.11.2007


10 Romanian companies authorized to sell MTPL
Last week, the Council of Insurance Supervisory Commission approved to maintain of the authorization of 10 companies for the sale of the motor third party liability insurances in 2008.
Thus, from 16 companies that sold MTPL on insurance market in 2007, only ALLIANZ-TIRIAC, ARDAF, ASIBAN, ASIROM, ASITRANS, ASTRA-UNIQA, BCR Asigurari, BT Asigurari, GENERALI and OMNIASIG submitted the files in order to keep the authorization. In the same time, ABC Asigurari, CARPATICA, CLAL, INTERAMERICAN, OTP and UNITA have not presented the necessary documents for maintaining their license.
by andreea.ionete@mxp.ro, 19.11.2007


ING Life grows the number of sold policies
During January - September 2007, ING Life registered a 15% growth of gross written premiums in comparison with the similar period of the previous year , reaching RON 364.8 million.
"We have had good results due to the portfolio's stability and due to significant sales in 2007", Bram BOON, General Director of the insurance company, has stated.
The number of sold policies grew with 60% than the first 9 months of 2006, to 59,000. The "Smart" protection insurance package, launched in 2006, reached 14,000 policies having the most important evolution.
"The growth of echeloned premiums from 50% to 75% highlights the increased Romanians' interest in the long term savings products, very well covered by life insurances", the quoted official has added
The value of assets under management rose with 28%, to RON 1.39 billion at the end of September 2007. Also, the value of paid benefits by ING Life reached RON 111 million, including benefits for life insurances, health insurances, accidents and invalidity insurances, up with 19.7% in the above mentioned period.
by mihaela.circu@mxp.ro, 14.11.2007


ASITRANS aims at EUR 30 million
In the first 9 months of the current year, ASITRANS wrote RON 66.62 million gross premiums (approximate EUR 20 million) and paid claims of RON 27 million, up with 34%, respectively 89%.
"These results emphasize the improvement of the services' quality, by solving quicker the claims files", Bogdan STAN, CEO of ASITRANS has declared.
"As concern the business figures, this year we aim at EUR 30 million and for the next two years we aim at EUR 50 million, respectively EUR 70 million", the quoted official has added.
Also, in 2007, the share capital of ASITRANS doubled, to RON 24.2 million, with the financial contribution of EUROHOLD, the majority shareholder (85%).
"At present, the share capital of ASITRANS is double comparing to the minimum capitalization demands imposed by Insurance Supervisory Commission", Bogdan STAN has mentioned.
The company's profit after the first 9 months of 2007 was around RON 110,000.
by irina.galasanu@mxp.ro, 8.11.2007


Changes in the OMNIASIG Life management
According to some sources in the market, Fanel PLOPEANU has ceased his collaboration with OMNIASIG Life.
General Director of the company since the end of 2005, Fanel PLOPEANU held important positions within companies like OMNIASIG and GENERALI.
The first 3 quarters of 2007 meant for OMNIASIG Life a RON 35.87 million written premiums. The gross premiums written on life insurances' segment represent RON 34.61 million, while health insurances and accidents and illness insurances registered RON 1.26 million.
After the first half of 2007, OMNIASIG Life holds the 10th position in the Romanian insurance market, with RON 23.93 million premiums and a market share of 3.48% according to Insurance Profile Review.
by mihaela.circu@mxp.ro, 13.11.2007


Strengthen of the merger at GARANTA
During January - September 2007, GARANTA wrote an amount of RON 60.94 million, less than the similar period of 2006, when premiums registered a total of RON 75.60 million.
Thus, life insurances' segment totalized RON 7.51 million written premiums, with RON 3.31 million more than the first 3 trimesters of 2006, while general insurances' segment represented almost RON 53.43 million than RON 71.41 million in the referred period of 2006.
"The most dynamic non - life insurances were goods insurances and motor hull insurances", Marian BACHES, Deputy General Director of GARANTA, stated for XPRIMM Newsletters.
As regards the paid claims, they registered a total of RON 32.8 million on general insurances' segment.
According to the quoted official, the growth of damages registered by motor insurances was determined both by the portfolio's increase and positive evolution of medium damage, the insurer recording an 80% loss ratio on this business line.
The company's plans regard strengthen of the merger with NBG, finished in May 2007.
"We are focusing on strengthen of the merger with NBG and unification of both company's portfolios as to have a solid foundation for the future development of GARANTA in 2008", Marian BACHES added.
by andreea.ionete@mxp.ro, 13.11.2007

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WILLIS
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Russian Insurance Market - increase with 25%
In the first nine months of the current year, Russian insurance companies generated EUR 15.63 billion in premiums, which was 24.9% more than in the same period last year, and they paid out EUR 9.23 billion in claims, a 37.6% increase on January-September 2006, Ilya Lomakin-RUMYANTSEV, Head of the Federal Service for Insurance Supervision (FSIS), reported on November 8.
As of September 30, 2007, there were 869 insurance companies in the united state register of insurance businesses. One hundred seventy one of them have licenses for writing compulsory MTPL insurance, 122 companies focus on compulsory medical insurance (CMEI), 30 market players specialize in reinsurance and 67 companies provide broking services.
FSIS has compiled financial data for January-September 2007 received from 817 insurers by e-mail. Eleven companies did not perform insurance operations in the reporting period, two insurers violated some requirements on financial reporting, and 39 companies did not present the reporting form 1-C by mail.
According to FSIS, the top 22 companies accounted for 60% of gross written premiums, the first 61 insurers generated 80% of total premiums and the leading 132 market players accounted for 90% in January-September 2007. In the first nine months of 2006, the leading 26 companies accounted for 60% of gross market premiums, the top 77 insurers - for 80%, and the top 129 companies - for 90%. Property insurance was the most popular insurance class among Russian companies, accounting for 35.7% of gross premiums written. Compulsory MTPL business took 9.4% and liability insurance represented 2.7%. The share of life premiums was 3.2%. CMEI premiums accounted for 35.1% of total market premiums.
In the first nine months of 2007, property insurance premiums amounted to EUR 5.58 billion, 19.3% more than in the same period of the prior year. Lomakin-ROUMYANTSEV noted that this insurance class posted the most rapid growth among voluntary insurance lines. "In the immediate future, property insurance will remain the main driver in the non-life insurance segment due to a sustainable increase of the share of new assets such as residential houses, funds and cars," explained the head of FSIS.
Liability premiums came to EUR 420 million, increasing 22.2% on January-September 2006. According to Lomakin-RUMYANTSEV, the particular features of the Russian liability business are its seasonal character and the predominance of corporate contracts. A&H insurance premiums generated by Russian insurers reached EUR 2.01 billion, a 14.5% increase against the first nine months of 2006. Corporate customers also play a significant role in this insurance class. Life insurance premiums jumped 50.4%, totaling EUR 490 million in January-September 2007. Premiums generated by compulsory lines showed a 31.7% growth and came to EUR 7.13 billion. Premiums written by compulsory MTPL insurance, the most popular compulsory insurance class, posted a 15.3% increase, amounting to RUR 52.8 billion. CMEI premiums came to EUR 5.50 billion, 38% above the January-September 2006 figures. In the first nine months of the present year, the Central Federal District accounted for 53.4% of total market premiums. Nevertheless, Lomakin-RUMYANTSEV expects the share of this region to decrease gradually. The Volga (Privolzhskiy) Federal District took second place with 13.2%. The North-Western Federal District ranked third, accounting for 10.4% of total market premiums.
by Russian Polis Newsletter, 12.11.2007


ALLIANZ Ukraine doubles its business
In the first nine months of the current year, ALLIANZ Ukraine, part of the international insurance group ALLIANZ, wrote USD 15.74 million in premiums, more than twice the reported number in the same period a year ago, and paid out USD 7.23 million in claims, a twenty-fold increase on January-September 2006.
Motor hull insurance contracts accounted for 67.5% of the company's portfolio. The share of A&H insurance (except life insurance) was 5.5%, while property insurance premiums accounted for 21.1% of total written premiums.
Motor insurance took 74.5% of total claims settled by ALLIANZ. Property claims accounted for 9.2%, whereas A&H insurance (except life insurance) took 13.5%.
As of October 1, 2007, the company's insurance reserves amounted to USD 13.87 million (a 184.1% jump compared with the previous year's figure). ALLIANZ's authorized capital rose 85.9% against the figure as of October 1, 2006, totaling USD 19.04 million. Owned by the ALLIANZ Group, the Ukraine-based insurance company ALLIANZ was registered on August 30, 2005 (prior to October 1, 2007, it was ROSNO Ukraine). Having licenses for writing 29 insurance lines, the company provides risk insurance services for individual and corporate clients. ALLIANZ is a member of the League of Insurance Organizations of the Ukraine and associate member of the Motor Transport Insurance Bureau of the Ukraine.
by Russian Polis Newsletter, 12.11.2007


155 EU-Based Insurance Companies Want to Sell Insurance In Bulgaria
155 insurance companies and 275 brokers based in EU want to sell insurance on the Bulgarian market, announced FSC. From the end of September until November 16th, 6 notifications have been sent to the Bulgarian supervisory body by the regulatory bodies of the respective countries. The newly applied companies are United Kingdom FREIGHT DEMURRAGE And Defence Association; AXA France IARD; LOMBARD INTERNATIONAL ASSURANCE SA.; SIRIUS International Forsakringsaktiebolag, FORTIS Corporate Insurance N.V. - the Belgian subsidiary of a Dutch company; UNION Vienna Insurance Group Biztosito Zrt. 96 insurance brokers have applied for the mentioned period.
by Insurance.bg, 19.11.2007


Premiums of EUR 400 million for Bulgarian insurers
The total premium income in the field of non-life insurance came to EUR 398.67 million, reads FSC report for the first eight months of 2007. In August only 2007 the insurers accumulated EUR 58.32 million, given that the premiums for the first seven months of 2007 amounted to EUR 151.11 million. The compensation payments made during the first eight months of 2007 came to EUR 151.39 million. Non-life insurance market was as dominated by motor insurance - Motor Casco and MTPL. Both products make 65.71% of all incomes and 87.27% of all compensation payments.
BULSTRAD Insurance and Reinsurance Company remains the leader in the field of non-life insurance with a market share of 15.96% (and 16.67% in July). DZI Insurance and Reinsurance Company came second with a market share of 14.24% (13.50% in July), ALLIANZ Bulgaria with a market share 12.77% (13.50% in July) and Bul Ins with a market share of 73.91% (12.23% in July).
The gross premium income in the field of life insurance came to EUR 70.68 million in the end of August 2007 (and EUR 62.30 million in the end of July 2007). The compensation payments made for the period came to EUR 17.84 million). The product that generated the greatest income (73.91%) and the greatest compensation amount (67.90%) is Life and Annuities. The market concentration is still high as the three leading companies hold 60% of the market. ALLIANZ Bulgaria Life came first with a market share of 25.97% (and 27.15% for the first seven months of 2007), DZI Insurance and Life Insurance Company with a market share of 18.34% (and 18.78% until July) and UNIQA Life came third with a market share of 14.92% (and 13.99% until July).
The premium incomes in the field of supplementary health insurance came to EUR 9.86 million. ZAKRILA has generated EUR 4.01 million proving the great concentration of the market. Medico-21 came second with income of almost EUR 1.23 million and DOM-Zdrave came third with premiums EUR 1.33 million. The compensation payments made in the field came to EUR 5.18 million. The product that generated the greatest income (22.38%) and the greatest compensation amount (25.55%) is Non-hospital Medical Care.
by Insurance.bg, 11.11.2007

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FINANCIAL NEWS



UNICREDIT estimates GDP will increase by 5.8% in Q3
Romania's economic growth rate is estimated by specialists of UNICREDIT group, one of Europe's largest lenders, to amount to 5.8% for the third quarter, exceeding the 5.6% rate registered in Q2.
The group's estimate is much lower than the 8.3% economic growth registered in July-September 2006. The 2007 forecast in terms of GDP increase is 5.8 percent, below the 7.7% in 2006, due to the negative impact of agriculture in terms of gross added value in industry, of over 18 percent, and a slowdown of the industrial output growth rate to a mere 6 percent.
The service and construction sectors will boost this year's economic growth. International Monetary Fund (IMF) experts have estimated that Romania's economic growth will reach 6.3% in 2007, and slow to 6% in 2008. The IMF forecast is more optimistic than that by the National Prognosis Commission, of a mere 6.1% in 2007.
Estimates by UNICREDIT specialists in terms of inflation indicate a 4.7% level for the average price rise in 2007, and 5.9% for December. In its latest report on inflation, presented at the beginning of November, the central bank revised upward the forecast for year-end 2007 by 1.8 points, up to an annual 5.7 percent, from the 3.9% level estimated in August.
by Business Standard, 21.11.2007


Real estate transactions of EUR 2 billion in 2007
The value of this year's real estate transactions could amount to EUR 2 billion, considering EUR 1.5 billion worth of deals were signed in the first nine months of 2007, most of which were on the retail market, followed by the office segment, and the industrial sector, according to studies made by the DTZ Echinox real estate consultancy company.
In Bucharest, most transactions were made on the office segment, while in other cities, retail ranked first. Most investments were on the office segment.
"The value of transactions will probably reach EUR 2 billion by the end of this year, and this level could also continue into 2008," said Cristian USTINESCU, Capital Markets Manager at DTZ Echinox.
According to the Cornerstone brokerage company, deals signed in the first five months of 2007 account for some 60% of the value registered for the whole of 2006. Colliers global commercial Real estate services company analysts identified 19 transactions totaling EUR 850 million in 2006.
The Arco Real Estate consultancy company said Romania is seen as the country with the most foreign direct investments on the real estate market in Southeastern Europe. These investments are estimated at EUR 10 billion in 2007.
This year's major transaction took place in the city of Constanta. The TRIGRANIT developer sold the POLUS Center to the IMMOEAST investment fund for EUR 185 million. In Bucharest, the largest transaction was the takeover of the America House office building by French NAXIS group for EUR 120.3 million.
by Business Standard, 19.11.2007


Between 5-10 new issuers on Bucharest Stock Exchange
The RAIFFEISEN Capital&Investment (RCI) brokerage firm estimates there will be 5-10 new issuers on the Bucharest Stock Exchange (BVB) in 2008, according to a statement to Business Standard by Dana Mirela IONESCU, RCI's General Manager.
"Countries in the region have more than 30 listings. If we estimate at least 5 listings next year, we hope that the number of listings will increase by 2009, so that we will become an attractive market in the region," said Dana Mirela IONESCU.
RCI is preparing two new listings for 2008, after running the Initial Public Offering (IPO) for the TRANSGAZ natural gas company this fall, which was the only operation of its kind on the Bucharest Stock Exchange (BVB) in 2007. The brokerage firm will bring the TERAPLAST terra-cotta tiles manufacturer and the ADEPLAST construction material producer to the stock exchange.
"The market needs new merchandise in order to develop," according to RCI's General Manager. IFB Finwest is another financial mediator who announced it is negotiating listing contracts, indicating that it is targeting four IPOs, whose value exceeds EUR 20 million.
RCI is market leader on the brokerage mediation segment. The company was a part of the consortium that ran the largest IPO to that date on the Romanian market in 2006, namely that of the TRANSELECTRICA electricity transmission operator.
by Business Standard, 13.11.2007


Romania is the most attractive M&A market in Eastern Europe
Senior managers in Central and Eastern Europe (CEE) have identified Romania as having the greatest potential for mergers and acquisitions (M&A) in the region, followed by Bulgaria. They expect Romania and Bulgaria to reach the highest level in terms of mergers and acquisitions and of activity of private equity funds. These managers share their strategic views and expansion plans on M&A. They expect an alert pace of acquisitions in the region in the coming 12 months.
Such as the conclusions of a report on Central & Eastern European Corporate Strategy made by KBC Securities, the integrated European Equity House of KBC Group, together with CMS and PENTA Investments. The report included the views of 100 managers in the Czech Republic and on the M&A climate in their countries, according to Budapest Business Journal.
More then half of managers interviewed indicated that is the most attractive market from their point of view, and that financial services are expected to be the most active sector in the coming year. Most senior company executives are targeting opportunities offered by western companies for their acquisitions.
by Business Standard, 9.11.2007

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