PAID's own CAT reserve amounted to EUR 6.19 million at the end of 2016, while net assets reached EUR 18.38 million. In Solvency II terms, the pool's own funds stood at EUR 16.47 million, with a SCR of EUR 13.21 million and a solvency ratio of 1.25. PAID's RI capacity increased 300% since inception (2010), to EUR 800 million, while its own retention went up to EUR 4 million. PAID recorded an EUR 76 million reinsurance profit since inception. "Considering our portfolio, we can successfully handle an event similar to the '77 earthquake", stated Francois COSTE, President of the Board, PAID Romania.
According to the RMS estimations, an earthquake similar to the 7.2 Mw one which in 1977 caused severe losses (~ USD 2.05 billion, up to 5% of the national GDP) and over 1,500 victims in Romania, would lead to a maximum losses of about EUR 775 million for the current PAID portfolio. At a national level, total losses may reach up to EUR 6 billion. The two figures reflect a wide CAT insurance gap: only 14% of the Romanian household are fully insured for a CAT event, being covered by both the mandatory policy and a facultative one, while and extra 6% of the homes are only covered by the mandatory policy (up to a total loss of EUR 20,000).
"Implementing an extended communication strategy aiming to raise awareness is one of the main PAID goals for the near future," Nicoleta RADU-NEASCU, PAID's General Manager, said. She has also mentioned as strategic priorities: strengthening even further PAID's own funds, extending the reinsurance program, continuing diligencies for ammending the mandatory home insurance legislation regarding the introduction of a deductible of the sum insured, maintaining and consolidating the pool's portfolio. " A lot of effort will be also put in accomplishing and testing the Mass Claims Plan, a plan involving all the insurance market segments, meant to allow the timely and correct settlement of claims in case if a major disaster," she stressed out.
The Pool's results were presented on the occasion of the reinsurance conference organized by PAID in Bucharest, under the titles "Building the future". Representatives of the most relevant reinsurers and reinsurance brokers, as well as of the Romanian insurers attended the event.