VIDEO: The impact of the COVID crisis on the Romanian insurance market - special edition on XPRIMM Time for Business

15 October 2020 — XPRIMM
XPRIMM Time for Business had a new international edition under the title "Re/insurance markets facing the Covid crisis" that focused on the evolution of Romanian insurance market under the specific uncertain situation created by the pandemic.

The special guests of the show have offered their official opinions about the Romanian insurance market:
  • Valentin IONESCU, Director Strategy and Financial Stability Department Romanian Financial Supervisory Authority - ASF
  • Adrian MARIN, President of UNSAR
  • Nicoleta RADU, CEO of PAID Romania
  • Gheorghe GRAD, Country Manager, RENOMIA SRBA Broker

Even if the expectations regarding the evolution of the economy on all business lines were not very optimistic, the results published by the Authorities regarding the insurance market were far better than foreseen.

Valentin IONESCU, Director Strategy and Financial Stability Department of Romanian Financial Supervisory Authority pointed out that "We expect a recovery of the Romanian economy in 2021, but there is still the uncertainty about the full recovery of the losses registered in the economy as the result of the crisis generated by COVID-19. Regarding the insurance sector in Romania, overall, it had a positive evolution without extreme fluctuations. The volume of gross written premium increased by 3.4% compared with the same period of the last year, the non-life insurance grew by 5.4%, but at the same time the life insurance business registered a decrease of about 4%. Regarding the capital market, insurance companies are not the main investors, but the total assets held by the insurance sector in Romania increased by 5% on the first semester compared with the end of 2019".

Adrian MARIN, President of UNSAR and CEO of GENERALI Romania has also explained that "Obviously, the evolution of the market is correlated with the effects of the pandemic and mirrors the economic development. On the long run, insurers will continue to make an important contribution to the national economy. People have become more aware of the risks they are exposed to and they are beginning to think about additional long-term protection: 36% of Romanians are considering purchasing a voluntary health policy, at the same time 58% of respondents are especially concerned about the risk of illness".

Regarding the corporate customers of the insurance industry, it seems that companies have managed the current situation. Gheorghe GRAD, CEO at RENOMIA SRBA said during the show: "On the second part of the year, there was a reconsideration of the interest of companies in renewal by reducing insurance plans and/or excluding dependents from the policy. But the same companies are more interested in a group life insurance policy. There are so many things that change in a short period of time and our ability to adapt the insurance products to the new reality of the business line brings actually our awareness. The concern of being protected is what this medical crisis raised up".

Beyond the pandemic, the other risks continue to manifest themselves. Moreover, in a crisis economy, they can have more dramatic consequences for the financial security of citizens. In this context, Romania has to deal with an already existing protection gap on the housing protection side.

Nicoleta RADU, CEO of PAID has shared some ideas about this subject: "It is true that the pandemic has changed many aspects of our lives. As far as housing protection is concerned, the number of valid house holding insurance policies has only grown by 5000 policies, but PAID is committed to raise awareness about the importance of house holding insurances. Covering a new additional natural risk through this mandatory system can be appropriate at any time as long as it will be considered beneficial for the protection of the Romanian population".

More opinions about the crisis` impact on the Romanian insurance market and which are positive of negative effects that it reveals on the long term, you can find out by watching the full debate on XPRIMM YouTube Channel.

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