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XPRIMM News No. 171, January 27th, 2011


XPRIMM News - The Romanian Insurance Market Newsletter
No. 171, January 27th, 2011

Optimistically looking at... 2012

Romania's economy will resume its growth in 2011, according to estimates of most analysts in the field. However, among insurers there is a mood somewhere in between moderate optimism and pessimism. This is also because, between the moment when the economy gives the first signs of "defrosting" and insurance recovery there is a delay of eight months (two months for the banking industry and another 6 for insurance).

What should profile companies do whilst awaiting this to come?

Firstly, there is the cost restructuring option. Thus, the development of alternative distribution channels, such as online sales, strengthening partnerships with brokers would be only a few solutions in this respect...

Also, 2011 may be a good time to focus on improving the quality of services and on customer loyalty. In a time when customers income is limited, insurers should be aware that any customer lost in this period will be extremely difficult to regain...

Another very promising measure is to start extensive information campaigns, in order to raise public awareness on the need for insurance.

It is known that 2011 will not be an easy year for the market, but it will pass soon... We are all expecting the 2012 "revival"!

On the 19th of December, we celebrated nine years since the founding of BCR Asigurari, and this represented a memorial moment. Throughout my entire career, I realized the importance of the team that I have by my side, because performance can not be achieved alone. People need leadership, as well as closeness, understanding and open communication.

Mihail TECAU
President of the Directorate, BCR Asigurari VIG
Mihail TECAUXPRIMM: You have been at the lead of BCR Asigurari for 4 years. How has your company changed under your management, what are the changes it has gone through?
Mihail TECAU:
On the 19th of December, we celebrated nine years since the founding of BCR Asigurari, and this represented a memorial moment. Throughout my entire career, I realized the importance of the team that I have by my side, because performance can not be achieved alone. People need leadership, as well as closeness, understanding and open communication.
Indeed, since October 2006, when I took over the management of BCR Asigurari, and until now, the company has undergone a series of transformations. The company was created in a financial supermarket. I have resized this collaboration, in terms of structure, product portfolio and operating mode.
The results of these processes could be summarized by three milestones: the constant performance, the permanent adaptation and the openness to customers.
I explain the constant performance through the stability of the position that the company holds on the Romanian insurance market. All these years, BCR Asigurari has remained among the first five insurance companies, on the general insurance segment. Gross written premiums volume increased year to year, as well as its product portfolio.


angela_toncescu_14The most important milestones of 2010 in insurance
Although the insurance market has felt the decline of other sectors, such as car sales or bank loans, and also rising unemployment and lower incomes of the population, in terms of quality, the situation is entirely different. Thus, "over the last two years, important projects for the development of the insurance market and the increase of the degree of protection of the policyholders' interests have been put into practice", said Angela TONCESCU, President of the Insurance Supervisory Commission, in an interview for PRIMM Publications. To the increase of the degree of protection of the insured have contributed, according to ISC President, "the introduction of the amicable report in case of accident, the establishment of the Insurance Management Institute, organizing and holding numerous professional training seminars with the insurance companies specialists for the implementation of the future Solvency II concept".

cristian_constantinescu6The optimistic scenario of Cristian CONSTANTINESCU: 2011 will remain at 2010 levels only if the property, life and health insurance business recovers the Motor Hull decline. How does the pessimistic one look like?
The main threat that is hovering over the insurance market in 2011 still remains the dependence of companies' business on the motor insurance activity, which, untill 2008, had been sustaining double-digit annual growths. "The macro-economic context and the pressures upon the incomes of financial products consumers will not induce favorable effects on the insurance industry in 2011". Turning now to the pessimistic scenario for 2011, "insurers will continue to fight for the preservation of client portfolios, which will translate to reduced premium rates, with a direct effect on the total volume of revenues and also on the profitability of the market", warned Cristian CONSTANTINESCU.

bogdan_andriescu9Bogdan ANDRIESCU is the new General Manager of the Insurance Management Institute
The Council of the Insurance Supervisory Commission (ISC) has decided to appoint Bogdan ANDRIESCU in the position of General Manager of the Insurance Management Institute (IMA). "Professional training for those working in insurance has always been a priority for me, both as President of UNSICAR and as a direct participant in the insurance activity. I am convinced that my 20 years of experience in direct relationships with insurance consumers will help me contribute to the professionalization of everyone involved in the insurance and insurance brokerage business, from this position of General Manager of IMA", stated Bogdan ANDRIESCU, officially appointed in his new position on Monday, the 17th of January 2011.

New European Regulations on health insurance
The European Parliament has adopted, during the previous week, a directive which states that patients have the right to receive medical care in any member state of the European Union (EU).
Oliviu STOICA is the new President of UNIQA Asigurari
Insurance Supervisory Commission (ISC) confirmed the position of Oliviu Gabriel STOICA as President of the Directorate of UNIQA Asigurari, following his appointment by the Supervisory Board of the company.
Karina ROSU and Valeriu ROSU retire from AON
AON Corporation announced, on January the 14th, 2011, that the AON Romania management team members, Karina ROSU, which holds the CEO position, and Valeriu ROSU, have decided to leave the group as of May 1st, 2011. "Karina and Valeriu have been working for our office in Romania for many years", said Onno JANSSEN, CEO of AON Central and Eastern Europe.
Nicolae MUSAT: The postponement of the mandatory household insurance has led to a freezing of the voluntary policies sale
The fact that the rhythm of mandatory household insurance underwriting has decreased, since January, does not mean that the Romanians have rushed into buying voluntary insurance - the whole system has stopped, said Nicolae MUSAT, Vice President of PAID and General Manager of CITY Insurance.
Mihail TECAU: Innovation is our chance now; in order to have a strong market, insurers must not go back to fighting over price
If, for 2010, BCR Asigurari VIG estimates to have maintained at the level of the results achieved in 2009, for the current year, the company hopes to surpass it, its strategy having as main vehicle the innovative ideas, that should bring to the insurer as many clients as possible.
VIG businesses in Romania fell by 12.8% in 2010. BCR Asigurari de Viata strongly supported the growth on the life segment, through bancassurance
Companies in Romania members of VIENNA Insurance Group (VIG) ended 2010 with business of EUR 536 million, 12.8% below the level achieved in 2009, of EUR 614.8 million, according to results published on the 25th of January by the Austrian group.
ING: Only a third of the Romania's population have a life insurance and only a quarter a pension plan, despite the expressed fear minding their financial future
Although almost 80% of the Romanian consumers administrate their personal finances in a responsible manner, a study by "ING Customer Resourcefulness" shows that over a global average of 70% are less active when it comes to utilizing financial instruments for a more secure future.
BCR Asigurari launched the first iPhone application dedicated to insurance
The company BCR Asigurari Vienna Insurance Group launches, in premiere for the Romanian insurance market, "iPhone Insurance Assistance - BCR Asigurari VIG". This application is specially designed to be downloaded and used on Apple iPhone type cell phones and is offered FOR FREE to BCR Asigurari policyholders who have Motor Hull "CASCO PLUS" insurance.
Health insurance from EUREKO is now also covering medical services abroad
EUREKO Romania, the health insurance market leader, offers its clients the opportunity to access hospital services and surgical interventions abroad, as a completion to the existing products. Until now, the insurer granted such coverage only if necessary medical treatment could not have been offered within the country.
PIRAEUS Insurance, the broker who sold most PAD policies in 2010
Between July 15th - December 31st, 2010, PIRAEUS Insurance Broker has sold 12,176 mandatory household insurance policies, of which 9,000 only in December, a result which has placed the company "on the first position among the insurance brokerage companies that sold these types of policies", said, exclusively for XPRIMM Newsletters, Cristian BALANICA, General Manager, PIRAEUS Insurance Broker.
CHARTIS Romania has a new Claims Manager
Leonard STANCIU has been appointed Claims Department Manager for CHARTIS Romania, at the end of 2010. "The end of 2010 gave me the pleasure and honor of joining the CHARTIS Romania Claims Department team", Leonard STANCIU declared.
KD Life Asigurari is transferring its insurance portfolio to KD Zivljenje and comes out of the Romanian market
The portfolio of KD Life, life insurance company placed under special administration by the Insurance Supervisory Commission in early March 2010, was transferred to the Slovenian company KD Zivljenje.
veronica_malcociVeronica MALCOCI, GRAWE CARAT: Amendments of the Contravention Code would allow insurance companies to contest the guilty parties
The evolution of the insurance market, on one hand, and of the company she manages, on the other hand, in the year that has just ended, as well as legislative, technical and procedural measures that should be implemented in order to give an impetus to the profile market were the main topics addressed, in an exclusive interview for, by Veronica MALCOCI, Manager of Non-Life and Life Insurance, GRAWE CARAT Asigurari. With all the difficulties of this year, in which there has been talked about the consequences of the economic crisis, about the still insufficient maturity of the insurance market of Moldova, the evolution of the market was, clearly, an ascending one.

medihelpMEDIHELP International is expanding in Moldova, in 2011
MEDIHELP International, the largest broker in Central and Eastern Europe, specialized in international health insurance, is taking its first steps for entering the Moldavian market, in 2011. Thus, the company is negotiating with the insurance companies in the Republic of Moldova minding the expansion across the borders, as a natural step in its organic growth.
tony_gordonMDRT Europe ClassIQ takes place next week, in Athens
As the final preparations for the 2011 inaugural MDRT Europe ClassIQ regional meeting in Athens in February are being made, we would like to highlight another one of the educational and inspirational speakers that attendees can look forward to: Tony GORDON, Past Chairman of MDRT's Top of the Table.
MDRT Europe ClassIQ regional meeting, a forum designed for the world's best insurance agents and financial services advisers, is organized by MDRT Europe and will take place on February 2-4 in Athens Greece. XPRIMM Insurance & Pensions support the event as Media Partners. The idea this concept is based on is learning how to be successful in every aspect of your life, because to be professionally successful is not always the same with a successful life.

Bulgarian insurers estimate a price increase for MTPL
The price for MTPL premiums issued in Bulgaria could see an increase of 5-10% by the end of this year, according to the estimations made by representatives of the profile local companies, quoted by
TRIGLAV estimates a net profit of EUR 54 million for 2010
Zavarovalnica TRIGLAV has reached a net profit of EUR 54.2 million in 2010, the volume of cashed premiums exceeding EUR 1 billion, the capital reaching EUR 607 million, according to Matjaz RAKOVEC, the company's CEO.
AXA acquires B&B Insurance in Belarus
AXA announced on the December 29th 2010 its 80% B&B Insurance Belarus share purchase, a company holding the first place on the local profile market and the second place on the local non-life insurance market.
VIG expands on the life insurance market in Macedonia
Insurance company WINNER Osiguruvanje, member of VIENNA Insurance Group, received from the national supervisory authority its practice license for life insurance, starting January the 1st, 2011.
Vladimir PUTIN supports the offer of a Russian investment group within CHAUCER
The Russian Prime Minister, Vladimir PUTIN, committed to help the Russian investment group PAMPLONA to raise its stake in British insurer CHAUCER, member of LLOYD's.
BASLER Osiguranje - Serbian leader in professional liability insurance for physicians
Only 3 years after entering the Serbian insurance market, BASLER, member of the BALOISE Swiss group, is now first place on the professional liability insurance for physicians segment.
Capital increases for the first two insurers in Montenegro
The end of 2010 brought with it important capital increase operations for the largest insurance companies in Montenegro (LOVCEN and SAVA MUNTENEGRU). Thus, at the end of December, the General Shareholders Meeting of LOVCEN Osiguranje decided a capital increase and issuing some new shares.
The first private insurance company in Bosnia ended 2010 with 16% increase
The Bosnian insurance company VGT Osiguranje closed 2010 with a 16% growth in the gross underwritten premiums, in comparison with 2009. According to the company's officials, the increase is due to an operational extension in the whole country, as well as to offering more protection products for small and medium enterprises.
Fall in inflation rate is certain
The annual inflation rate will drop from the peak level of 8 percent reported in December to 6.7 percent in January, is stated in a RAIFFEISEN report on Romania's economic prospects in 2011, "Financiarul" informs. Inflation will fluctuate between 6.6 percent and 7 percent up to June, while July will bring about another significant slump, a little below 5 percent, analysts further say.
WB approved EUR 300 million-loan to Romania
Romania receives another instalment from the World Bank. The country had already been transferred EUR 300 million out of the EUR 1 billion-loan, the transfer of another EUR 300 million was approved on January 20th, and the remaining EUR 400 million will be included in the new loan agreement between Romania and the World Bank, reports.
Economy Ministry plans to obtain in 2011 almost RON 3 billion of privatizations and stock exchange listings
Economy Ministry relies in 2011 on revenues of RON 3.11 billion, of which RON 2.88 billion would come from privatizations. The institution dealing with the state's participations and privatizations in the industry on behalf of the Economy Ministry, OPSPI, manages the Ministry's economic operators, mainly energy companies.
Key to economic recovery lies in higher efficiency, IMF's FRANKS says
Romanian economy can start to grow particularly by increasing capital value, as well as by boosting work productivity and an effective use of workforce and investments, the head of the IMF mission to Romania, Jeffrey FRANKS, said on January the 26th, according to sources who attended the meeting between the IMF mission and the members of the Social and Economic Council (CES), "Romania Libera" reports.

President: Sergiu COSTACHE CEO: Adriana PANCIU
Business Development Director: Alexandru D. CIUNCAN

Editor in Chief: Mihaela CIRCU
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