No. 152, March 25th, 2010
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XPRIMM
News - THE ROMANIAN INSURANCE MARKET NEWSLETTER No. 152, March 25th, 2010 Click here to subscribe! Click here to unsubscribe! |
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| EDITORIAL |
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MTPL is uncomfortable for the customers. People don't love anything that is mandatory, especially when it comes to an insurance "for others", ignoring that responsibility is of the guilty part, and anybody can be guilty. During this time, the wrong messages reach customers: MTPL is a tax that exists only in Romania, tarrifs increase to cover the losses of the companies that, anyway, do not pay their claims. Yes, insurers do not pay claims for MTPL. As long as - we are not afraid to say it directly - there are companies that do not pay their obligations, can we blame the press or the customers for generalizing a state of fact seen punctually at the market level? In a normal market, all insurers pay their claims. In Romania, the payment of claims in time is, along with the price, one of the main criteria for buying a certain insurance product. For MTPL, "cheap" is the keyword. In this framework, a proposal comes: to make customers love the MTPL! What does this translate into? In short: in case of an accident, the claim can be paid to the damaged part by the company where it has bought the MTPL! Sounds simple, motivating for the client, maybe a little annoying for some insurers! by alex.rosca@mxp.ro |
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CEE, RUSSIA&CIS | FINANCIAL NEWS | EVENTS |
| INTERVIEW |
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Antonio SOUVANNASOUCK: Insurance industry is a balancing segment of the economy, characterized by continuity (most of the insurance contracts are annually renewed), and because of that the impact of the crisis was quite low. Of course the insurance market has also been affected, but considering the collapse of the financial market, of the auto market and of consumption, where declines have been dramatic, the decrease of the insurance market is minimal. We were used to 2-digits increases and it is normal, given how much we are behind the insurance markets from the EU, but this minimum decrease emphasizes the stability. In addition, there were no bankruptcies or special closures of activity. XPRIMM: How do you see the evolution of the insurance market in 2010? (in the context of an extension of the economic crisis) A.S.: I do not see an extension of the economic crisis. This is the crisis. It takes as long as it is necessary for a correct rearrangement of values. The insurance volume will still have a minimum fluctuation of +/- 5-7%. If the Romanian state will be able to implement solutions of accelerated stepping out of the crisis, especially if it succeeds to "unlock" investments in infrastructure, we will have an increase in 2010. XPRIMM: What is currently the most pressing problem of the insurance brokerage market? (except the economic crisis) A.S.: "Throwing" all responsibilities on brokers and the marginalization of their activity. Insurers are "assaulted" by the claims that they suspect to be mostly fraud. This phenomenon exists anywhere in the world and it is unfortunately accepted as a "technological loss", within reasonable limits. Only that in mature markets there are analysis and discernment and, not least, the law is applied. A second reason for concern is the tendency of customers, both corporate and retail, towards the cheapest product. Services related to the insurance product, both from insurers and mostly from brokers, have no value anymore. The word of order is "as cheap as possible", forgetting the fact that insurance/insurance related services have various degrees of quality and that, usually, "the cheapest" means poor quality, as for any type of product, except for the fashion segment... XPRIMM: How was the bonus-malus system perceived by your customers? What is your opinion on this? A.S.: I for one am particularly upset because of the introduction of the bonus-malus system last year. It should have been introduced a long time ago. Considering that the motor insurance segment has been taking a turn into the red for about 6 years, the introduction of this system 7 years ago, in full ascension of the insurance market, would have had a positive impact on the motor market, especially by changing the mentality. I am looking forward for the implementation of a system integrated in the market, for the application of the bonus-malus system and for Motor Hull insurance. XPRIMM: Which will be, in your opinion, the consequences upon the profile market of the coming into force of the law of mandatory household insurance? A.S.: I see two important aspects. Part of the population will perceive this insurance as a new tax and some people, the "God-fearing ones", will pay, while the others won't. Another part will understand the need to insure and maybe they will be convinced to buy a voluntary insurance. I hope very much that voluntary household insurance will be "boosted" a lot, maybe not in the first year, but over time people may understand better the need for voluntary insurance. XPRIMM: How did the corporate segment evolve in 2009? But the retail one? A.S.: Both segments had very much to suffer. Many companies have gone bankrupt or have dramatically reduced activity. Others have decided to self-insure or could no longer pay insurance premiums. Insurance revenues have also decreased due to the fact that property insurance has benefited from a 15-20% decrease of the premium quotations, due to increased capacity of reinsurance markets and to the re-orientation from motor insurance that brings losses. Regarding the retail, it suffered equally, as the population grew poorer because of the financial crisis, besides, motor insurance, which represents over 95% of the retail insurance segment, got more expensive by 15-20%. XPRIMM: Do you consider Bucharest to be a saturated market in terms of competition? A.S.: Competition is always welcomed. I believe that the loss of a customer in front of competitors can teach you many things. This is basically valid in a developed and civilized market. Unfortunately, in Romania we do not have such a thing and I observe, in this time of crisis, a worsening of the competitive environment in general and its contamination in Bucharest in particular. To be more explicit, I mean: bribes, nepotism, group interests or others... XPRIMM: Is an expansion of the sales force appropriate, at this time? Do you think the economic situation brings new oportunities of finding people to work in insurance? A.S.: I see that on the market there is plenty of labor force in the field. Unfortunately, much of it is made up of former insurance agents/insurance advisors, who were abandoned by their insurance companies and are looking for income. Their training was often mediocre and unidirectional (life insurance, retail etc.). But I think that it is an opportunity of investment for the future, especially for retail, the more so as the profit margin in the field will keep decreasing, so the volume must be increased. XPRIMM: What opportunities do you see for your company's activity in the next period? A.S.: If this year the market conditions do not allow a growth, we will take advantage of this to reorganize the sales structure, to optimize the management procedures, to develop new services. We are also considering the development of a structure of partners in franchise. XPRIMM: What is the portfolio structure now? Did it suffer changes as a consequence of the economic crisis? A.S.: Looking at the structure of the portfolio on risk classes, it has not changed and it is similar to the structure of the market. In 2009, we had a decrease on the corporate segment and a slight increase on retail. XPRIMM: How do you assess the company's results in 2009? How do they present themselves if we compare them to the 2008 results? A.S.: I do not have the final data yet, but preliminary results show a small decrease, of about 5% compared to 2008. I think that we have surpassed very well an extremely difficult year. XPRIMM: What are the main objectives of your company this year? (Total volume of mediations, personnel structure etc.) A.S.: Honestly, I think it cannot be worse than in 2009, so I predict a 10-15% increase in turnover, based on a slight recovery of the economy, on the further growth of the premiums on the motor segment and on a rebound of premiums for property insurance. I rely also on offering new services to customers and on the development of the franchise system. XPRIMM: Thank you! |
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CEE, RUSSIA&CIS | FINANCIAL NEWS | EVENTS |
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PAID contracted the IT service provider and will issue policies starting July 1, 2010 The Pool of Insurance Against Disasters (PAID) has signed a contract with the company ESSENTIAL Systems, for the purchase and realization of the IT system that will manage the policies sold by the company, according to statements of Marius BULUGEA, General Manager of PAID, at a specialty seminar. Click here to read more! by oleg.doronceanu@mxp.ro, 18.03.2010 UNSAR requests deductibility within the limit of EUR 400 for life insurance The National Union of Insurance Companies in Romania (UNSAR) requires authorities to introduce deductibility for premiums written on life insurance, with a maturity of more than ten years, within the limit of EUR 400, for the employee and for the employer. UNSAR filed yesterday, at the Government, the Ministry of Finance, the Ministry of Labor and the specialty committees from the Parliament, an official letter in this respect, according to which the limit of deductibility for the income tax (respectively, profit tax for the employer) would be similar to that for the voluntary private pensions segment. Click here to read more! by oleg.doronceanu@mxp.ro, 23.03.2010 Brokerage market in 2009: mediations up by 18% and revenues down by 15% In 2009, insurance brokers have mediated 36% of the value of the underwritings on the market, up by 6% compared to the previous year. Thus, last year, the volume of mediated premiums amounted to almost RON 3.2 billion (gross written premiums), 18% more than in 2008, according to the National Union of Insurance Brokerage and Consulting Companies (UNSICAR). Click here to read more! by oleg.doronceanu@mxp.ro, 19.03.2010 ISC forces the companies to answer complaints within 30 days Insurance companies will be required to develop on-line systems for receiving the complaints of clients, according to a draft law posted for debate on the ISC (Romanian Insurance Supervisory Commission) website. The deadline for the implementation of this module on the sites of companies is of 30 days from the date of the entry into force of the norms. Click here to read more! by mihaela.circu@mxp.ro, 16.03.2010 GENERALI Group is interested in acquisitions in the region, including Romania The Italian insurer GENERALI announced it aimed to grow operations in Russia, Poland and Romania, evaluating possible acquisitions in those countries, according to statements of Giovanni PERISSINOTTO, the CEO of the group, quoted by BLOOMBERG. Click here to read more! by andreea.ionete@mxp.ro, 22.03.2010 The business of UNIQA Asigurari fell by 4% in 2009, to RON 487 million UNIQA Asigurari has ended 2009 with gross written premiums of RON 487 million, down by 4% compared with the 2008 results of the company, of RON 507 million, according to preliminary data published by the insurer. Also, the claims paid in the same period totaled RON 409.51 million, 5% more than in the previous year. Click here to read more! by andreea.ionete@mxp.ro, 22.03.2010 Business of RON 2.15 million for AEGON, in the first year on the market AEGON Asigurari de Viata, company launched on the Romanian profile market at the beginning of the previous year, reported in the first year of activity underwritings of RON 2.15 million (about EUR 520 thousand). Unit-linked policies accounted for approximately 80% of company sales (RON 1.76 million) or a number of 1,718 policies, out of the total volume of 2,153 contracts signed in 2009. The most important sales channel of the company was represented by insurance brokers, who own a 84% share of the total underwritings of the company. Click here to read more! by oleg.doronceanu@mxp.ro, 12.03.2010 Parliament looks at MTPL problems The Economic Policies Commission of the Chamber of Deputies will start an investigation that aims to analyze the activity of the insurance companies in Romania. Click here to read more! by mihaela.circu@mxp.ro, 16.03.2010 KD Life is still alive The Special Administration instituted by the ISC for the company KD Life at the beginning of March has as main objectives the relaunching of the company by increasing the share capital, either by the present shareholders or by other interested investors, the protection of the interests of the insured, as well as reducing costs in order to make the activity more efficient, according to a company press release. Click here to read more! by andreea.ionete@mxp.ro, 16.03.2010 Health insurance: High potential, low achievements The private health insurance market has a potential of EUR 400 million, but only 12% of it could be reached by 2012, according to estimates made by Polish research company PMR. According to the analysis, the profile segment will experience growth in the coming years, and insurers will begin to "steal" patients from healthcare providers. Click here to read more! by oleg.doronceanu@mxp.ro, 24.03.2010 Revising the malpractice law A new modification of the law on malpractice could enlarge the list of those to be held responsible in case of a medical fault. Thus, in a project of law found in public debate, is introduced the mandatory insurance in case of mistake for providers of healthcare, medical and pharmaceutical products and services. Click here to read more! by mihaela.circu@mxp.ro, 15.03.2010 |
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CEE, RUSSIA&CIS | FINANCIAL NEWS | EVENTS |
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| 6.3% decrease for Bulgaria's insurance market in 2009 For the first time in six years, Bulgaria's insurance market decreased by 6.3% on an annual basis, with premiums adding up to BGN 1.7 billion (EUR 869 million) - showed the figures presented by the Financial Supervisory Commission (FSC). Life insurance tumbled by 18% to BGN 221.6 million (EUR 113,3 million). Click here to read more! by Dvevnik, 22.03.2010 Croatian insurance market totaled EUR 0.22 billion Croatian insurance companies reported gross insurance premiums of EUR 0.22 billion, a 1% decrease over the same period last year, according to cumulative data from the Croatian Insurance Bureau for January and February 2010. Click here to read more! by limun.hr, 22.03.2010 Big plans for ERGO in Eastern Europe Insurance Company ERGO (MUNICH Re's primary insurance unit) intends to triple the share of premium growth from Eastern Europe, where policy sales are coming off a low base, according to WSJ. Click here to read more! by mihai.cracea@mxp.ro, 23.03.2010 PZU - interested to take over Belorussian BELGOSSTRAKH Polish-based PZU, the biggest insurance company on the local market, has expressed its interest in Belorussian state-owned insurer BELGOSSTRAKH, according to sources from the local market. Click here to read more! by oleg.doronceanu@mxp.ro, 23.03.2010 PZU posts record profit before IPO PZU SA, Poland's biggest insurer, posted a record profit of USD 1.3 billion last year, improving earnings before its initial public offering planned in the second quarter of this year, according to BLOOMBERG. Click here to read more! by oleg.doronceanu@mxp.ro, 24.03.2010 Sixth International Risk Management Conference to be held in Kazakhstan The Sixth International Risk Management Conference will be held this year traditionally on 14-15 April 2010 in Almaty, Kazakhstan. This will be the Sixth Annual Conference on Risk Management organized and sponsored by EURASIA Insurance Company. Click here to read more! by oleg.doronceanu@mxp.ro, 25.02.2010 All-Russia Conference on Reinsurance has come to its 14th edition All-Russian Union of Insurers, with the support of the business center "DELOVOY Format", proudly presents their next conference "Reinsurance Efficiency: Lessons of Crisis", to take place in Moscow, National Hotel, on 25-26 March 2010. The annual All-Russian Reinsurance Conference has traditionally become a major social event which brings together Russian reinsures and their foreign colleagues for the 14th time already. In 2009, the Conference was attended by 450 Russian and foreign reinsurers and guests, members of government bodies, market experts and mass media from 18 countries. Click here to read more! by oleg.doronceanu@mxp.ro, 25.02.2010 Russian Insurance Summit 2010 On May 20-23, 2010, the Russian Association of Insurers holds the VIIIth Annual International Insurance Summit in the city of Vladimir, club VELES. Within the framework of the Summit there will be discussions on the present situation and on problems of the national insurance market in the context of international insurance development. The main theme of the Summit will be "Insurance into the Second Decade of the XXIst Century". Click here to read more! by oleg.doronceanu@mxp.ro, 25.02.2010 Tashkent International Insurance Forum On April 8-9, 2010, SAIPRO holds Annual International Insurance Forum in the city of Tashkent, Republic of Uzbekistan. Among the invited participants there are: top managers of foreign and national insurance, reinsurance and brokerage companies and other organizations, representatives of ministries, departments, state and public organizations, heads of foreign insurance market regulatory bodies, national and international associations, banks, investment and audit companies. Click here to read more! by oleg.doronceanu@mxp.ro, 25.02.2010 |
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Romania's auto trade with Germany scores surplus FITCH Ratings awarded "BB+" to Romania's Eurobonds issue |
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