No. 78, February 22nd, 2007

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FIAR 2007 - International Insurance - Reinsurance Forum


And the grand winners are...
The Insurance Brokers

It's more than obvious that the Romanian insurance industry has gone through a series of transformations meant to prepare it for the European Union. But the major changes are yet to come...; That is why we can suppose that the growing competition on the market will lead to the improvement of the brokerage segment's services.

In the last years, the insurance brokerage market has known a rapid growth regarding the mediated premiums volume, while their quota in the total volume of underwritings staying at a constant level of about 20%.

2007, Romania's first year in the European Union seems to be the moment when the brokerage market will make a step forward regarding growth, because of winning a "bigger slice" of the GWP "cake", but mostly thru a profitable collaboration with the foreign companies that intend to sell their products on the Romanian market thru alternative channels.

Therefore, we can say that the grand winners of the fact that a lot of European insurance companies have notified the ISC (Insurance Supervisory Commission) regarding their future activity in Romania, are the brokers because many insurers will want to use their services, thus avoiding the big expenses of building and sustaining a network.

At the same time, the brokers will also win because of the fact that there will be much more business opportunities on the Romanian market.

Nevertheless, we should also look at the other side of the shield... At the beginning of the current year, over 20 insurance brokerage companies from Great Britain have notified the ISC with regard to their intention of entering the Romanian market. Companies like: NORWICH Union Healthcare, GOODHEALTH Worldwide and BUPA Insurance Services are expected to enter the market.

Therefore, the growing role of the insurance brokerage companies will have to be doubled by a growth of the quality of services offered to clients. The brokers will evolve from a mediated and a distribution channel to a consultant which offers complex risk management services to the client.

by mihaela.circu@mxp.ro

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BCR Asigurari de Viata
Club ARO
The Money Channel



Interview with Mr. Constantin TOMA,
President - General Manager

XPRIMM: Do you consider the Romanian insurance industry as being prepared to deal with the challenges brought by the integration into the EU?
Constantin TOMA:
The favorable evolutions that have been registered lately (the harmonization of the legislation with the communitarian acquis, the increase of the efficiency, and the level of competence and professionalism in the companies operating in the local market, the offer similar to that of the countries with a tradition in the insurance industry, regarding the covering up of risks, capitalization rate, the increase of the reinsurance rates etc.) allow us to be optimistic about the successful adaptation of the local insurance industry to the requirements that result from the accession to the EU.

XPRIMM: What are the main opportunities for the Romanian insurance companies in 2007?
On one hand, there are the specific opportunities offered by the change of the legislative frame, related to the adaptation to the Norms of the European Union (e.g.: the introduction of the compulsoriness of new products of professional liability insurance, the increase in the minimum limit of liability for some of these products, etc.).
On the other hand, the pre-stipulated developments of the financial markets of the capital market, and the growth of the Romanian economy as a whole, imply interesting opportunities for insurers. In our opinion, it is the private pensions and the professional liability insurance that represents the "opportunities of the year".

XPRIMM: Do you think that there are factors that could influence negatively the development of the market?
First of all, I would mention the specific factors, of a bureaucratic nature. The process of alignment of the local market to the EU Norms specific to the insurance industry (for example: the method of recording the financial information, the method of computation of solvency, and the specific requirements imposed for the practice of certain types of insurances, etc.) could generate problems of adaptation to the post-adhesion requirements for some of the market operators, and might lead to certain "gap of development".
In our opinion, the process of stabilization of the local market will continue during the entire 2007 year. We estimate that the pressure of competition determined by the free access to the local market, and the entry in Romania of a big number of European companies, will generate significant regroupings of forces, fusions, alliances and acquisitions among the local operators.

XPRIMM: What is the most important objective of the company you are leading, for this year?
For 2007, we are aiming for a 20% growth in our turnover, and gaining one place in the insurers' top, under the conditions of the growing quality of services offered to the clients.

XPRIMM: Thank you!

by mihaela.circu@mxp.ro

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Constantin TOMA
Mr. Constantin TOMA,
President - General Manager


Romania, the most attractive target
Romania was designated in the latest Ernst & Young study as the most attractive target for foreign investments in the South-Eastern Europe, surpassing the Czech Republic and Poland. The study involved 200 company executive managers worldwide.
Briefly, 58% of the respondents indicated Romania as an attractive country for their businesses and 28% mentioned Romania as a destination for future investments. Romania is preferred due to low taxes on profit, low labor force cost and productivity increase potential. The weak spots of Romania are the infrastructure, the research centers, political stability and the quality of life.
by costi.boroda@mxp.ro, 21.02.2007

Inflation rate down to 4.01% in January 2007
The inflation rate for the past 12 months stood at 4.01% in January this year with a monthly rate of 0.2%, down from 0.74% in December 2006, according to new data from the National Statistics Institute-INS. In January, the most significant price rise was reported in the services sector (+1.04%) and food products (+0.28%), while non-food product prices dropped by 0.2%.
The lower prices for non-food products were set by lower natural gas prices (-3.5%), drugs (-1.8%), fuel (-0.8%) and others.
And higher tariffs for services such as car insurance, water supplies, sewage services, urban transport, postal and telecom services led to increased prices in the sector.
The annual inflation rate stood at 4.87% last year, within the National Bank of Romania (BNR) target of 5%+/-1%. BNR set an inflation target of 4%+/-1% for 2007 with an inflation forecast of 4.7%.
by andreea.ionete@mxp.ro, 13.02.2007

Lower unemployment rate in 2007
The European accession found Romania with better employment figures: 29,000 employees more in December, compared to November 2006, a release of the National Statistics Institute reveals. Compared to December 2005, the number grew with 62,500.
The unemployment rate in December 2006 was 5.2% out of the entire active population, compared to 2005's 5.9%. The same indicator was 4.6% for women and 5.7% for men.
by costi.boroda@mxp.ro, 15.02.2007

Foreign direct investments increased to EUR 9.1 billion in 2006
Foreign direct investments increased 75% in 2006, compared to previous year, up to EUR 9.1 billion, the value including the EUR 2.2 billion cashed from the privatization of the Romanian Commercial Bank (BCR), according to data released yesterday by the National Bank of Romania (BNR).
Loans given by companies abroad to their subsidiaries from Romania represented a third of the foreign investments, while the shares in capital and reinvested profit amounted to two thirds of the total.
BNR statistics regarding the value of foreign direct investments at the end of 2006 exceeded the estimations made by the authorities and international economic organizations.
Romanian Agency for Foreign Investments estimated for last year a level of EUR 6.2 billion, without including the privatization of BCR. The United Nations Conference on Trade and Development (UNCTAD) estimated that FDI in Romania increased last year 34.%, to USD 8.6 billion, while the latest report issued this week by ERNST & YOUNG Romania estimated the volume of investments at EUR 8.5 billion-EUR 9 billion. Romania was in 2006 the most attractive target for FDI in the South-Eastern region.
by andreea.ionete@mxp.ro, 15.02.2007

Romania leads in contructions sector
Romania recorded in December one of the highest growth rates in the constructions' production, 24.2% more year over year and 2.7% more, compared to November. The only country ranking above Romania was Slovenia, with some 30%, according to the Eurostat data.
Romania ranked above countries like Germany (16.1%), Belgium (10%), France (6%) and Poland (19.4%).
The production in 2006' Q4 was 22.2% above Q3. In the EU-25, the highest growth rates were recorded in Slovenia (31.7%), Lithuania (25.6%) and Poland (22.6%).
by costi.boroda@mxp.ro, 21.02.2007

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Awards for insurance pioneers
The Insurance Supervisory Commission (ISC) celebrated on the 19th of February 2007 15 years of supervision and control over the insurances in Romania.
In a classy event an award ceremony for the pioneers of insurance supervision and control took place. University professors that have developed the Romanian insurance literature, leaders of the first insurance Romanian companies and journalists that paid constant attention to the field, thus understanding and highlighting its importance were celebrated.
"We would like to mark a new beginning for the ISC by its transformation from a controller into a supervisor", Angela TONCESCU, President of the supervisory authority, mentioned during the event.
During the event, three types of awards were handed out: of Excellence, Special and Honorific.
"The Excellence Awards were offered to important personalities of the insurance field, politics or social, those that have had a major contribution to the development of insurances, to the increase of supervision and control capacity of the ISC, to the legislative framework for insurances, to the development of the insurance culture by educating specialists and publishing specific materials", Angela TONCESCU stated.
The Special awards were offered to those that have had a contribution to the creation and development of a competitive market, by their direct or indirect involvement in the insurance system.
"The Honorific awards were handed out to those that, by their daily activities, have contributed to the development of a functional supervisory mechanism, as well as to journalists that have paid special attention to the field", the ISC President explained.
With this occasion, Media XPRIMM was rewarded with three Honorific awards for Sergiu COSTACHE, General Director of Media XPRIMM, Daniela GHETU, Editorial Director of PRIMM Publications and Alexandru CIUNCAN, XPRIMM Newsletters Coordinator.
by mihaela.circu@mxp.ro, 20.02.2007

EUR 1.6 billion for the Romanian insurance market
The Romanian insurance market reached by the end of 2006 the level of EUR 1.6 billion according to the data provided by the Insurance Supervisory Commission.
The growth level, compared to the 2005 results, is about 31%.
General insurance underwritings have reached a volume of EUR 1.3 billion, and the life insurances had a contribution of about EUR 300 million
by mihaela.circu@mxp.ro, 20.02.2007

Increasing competition on the MTPL segment
Six of the 50 companies that have notified the Insurance Supervisory Commission on the intention of activating in Romania intend to operate on the MTPL segment.
The six insurers originate from the United Kingdom, amongst which we can notice NORWICH Union, QBE Insurance and XL Insurance.
" The companies that have notified their intention of providing insurance products on the Romanian market should not be underestimated", Angela TONCESCU, President of the supervisory authority, has recently stated.
Now, there are 15 insurers authorized by the ISC to provide MTPL insurance.
by mihaela.circu@mxp.ro, 21.02.2007

ASITRANS finances its development plans
The insurance company ASITRANS intends to increase its share capital in order to finance the development plans for the upcoming period.
"We will increase our share capital with RON 3 million , in order to finance our objectives for this year", Bogdan STAN, ASITRANS CEO stated.
Based on the free circulation of services principle the company will expand its activity in Bulgaria and Hungary, first through the aid of brokers and after by establishing subsidiaries in the two countries.
The insurer underwrote almost EUR 14 million during the first 9 months of the previous year, covering 1.14% of the market. The company grew by 140%, in the European currency, compared to the results registered in the same period of 2005, and the real growth, in the national currency, was of over 121% in the analyzed timeframe.
by andreea.ionete@mxp.ro, 21.02.2007

Editorial release for the health insurance field
The first specialized book for private health insurances was launched on the 19th of February within the Award Ceremony for the ones that had a contribution to the establishment and development of the insurance supervision and market, as one of the events that mark's 15 years of efficient supervision in insurances.
Entitled "Health insurance between the paternalist state and individual responsibility", signed by univ. reader Dr. Dan CONSTANTINESCU, member of the Insurance Supervisory Commission Council.
"Published under favorable circumstances, the present volume obliges the author to continue the research in this field. We would also like to thank all those that want to improve this work", Dan CONSTANTINESCU stated.
Mr. Dan CONSTANTINESCU is a visionary as he saw the necessity of approaching the health insurance field and of the medical service providers", Eugen NICOLAESCU, Health Minister stated.
Ioan Aron POPA, President of the Senate's Budget-Finance-Banking Commission, saw a true "starting point for private health insurances" in the book.
" It's a economic analysis, and this approach on private health insurance development is a major step for Romania. We live in a society of risk, thus no work in the insurance field should lack its juridical reinforcement", Mircea DUTU, Rector of the Ecologic University mentions.
The Academician, Constantin BALACEANU-STOLNICI saluted this book by stating: "I would like to join forces with the author in supporting the private-public partnership, not only in health insurances, but also in the university field, as it can represent a good source of benefits".
"The work that has been presented to us today completes the specialized literature with a pragmatic and convincing approach of an important social issue", univ. prof. dr. Florian BERCEA mentioned.
"I feel that this work fills a void in the specialized literature and can be useful to those training for the health insurance experts, economists, jurists and medics", univ. prof. dr. Mircea CINTEZA underlined.
by andreea.ionete@mxp.ro, 20.02.2007

ING, biggest profit on the market
The profit of ING Life in 2006 reached EUR 14 million , 40% more than in 2005.
There is the possibility that the insurer has registered the biggest profit on the market as the largest insurance company in Romania, ALLIANZ-TIRIAC estimated a profit of EUR 11.7 million for 2006.
The underwriting volume of ING Life has reached EUR 123 million in 2006, 15% more than in the previous year.
The growth rate registered by the Dutch group's subsidiary surpassed the ones in Slovakia, Poland or Czech Republic, and its share in Central European operations is about 10%.
The ING officials announced their participation on the private pensions market on both Pillar III, and Pillar II in the future.
"The ING's file for Pillar III is almost ready. So, we want to operate on this market and be a much significant player", Bram BOON for XPRIMM Newsletters mentioned.
ING Asigurari de Viata is the leader of the life insurance market in Romania. The company had, after the first three quarters of last year, a market share of 39%, registering a growth, in EUR, of 15% compared to the first nine months of 2005.
by andreea.ionete@mxp.ro, 19.02.2007

RON 53.16 million underwritings for INTERAMERICAN
INTERAMERICAN finalized 2006 with a total volume of underwritten premiums of RON 53.16 million , 14% more than in 2005.
"We are proud of our results. The preliminary data that we have show that we are amongst the first four companies in the life insurance segment, in terms of growth, one that was achieved solely through our network of insurance consultants", Timo VAN VOORDEN, President and CEO, INTERAMERICAN Romania stated.
The biggest growth, 23% compared to 2005, was registered on the life insurance segment. The volume of underwritten premium on this segment was of RON 27.41 million , out of which, life insurances with an investment component registered a growth of 99% compared to 2005, supported by the excellent evolution of INTERAMERICAN's investment funds.
General insurances registered a growth of 5% compared to 2005 and the underwritings volume was RON 25.75 million , as there was prudential approach to the motor insurance segment because of its high claims combined with a successful property insurance policy.
The health insurance segment registered a growth of 141%. This performance is due to the expansion of the MEDISYSTEM network. In present this network holds the EUROCLINIC private hospital and other 75 health service providers, employing 1000 medics and specialized personnel offering services in 16 cities: Bucuresti, Buzau, Focsani, Iasi, Cluj, Targu Mures, Brasov, Alba Iulia, Craiova, Timisoara, Arad, Oradea, Sibiu, Constanta, Satu Mare si Baia Mare.
The medical services offered by the INTERAMERICAN Romania group, through the EUROCLINIC Hospital registered a profit of RON 7.5 million in 2006, 300% more than in 2005. Above the financial results of EUROCLINIC one must notice the 99% patient satisfaction. "The EUROCLINIC Hospital's results confirm our strategy of quality without any compromise", Timo VAN VOORDEN stated.
by mihaela.circu@mxp.ro, 15.02.2007

Optimism on the agricultural insurance market
The growth perspectives of the Romanian agricultural insurance market are regarded with an encouraging optimism by the companies that activate mainly on this segment.
"The agricultural insurance market will see a strong development in the next few years, due to the foreign investments that will create new potential clients in the field", Alexandru BARBU, Marketing Manager, FATA Assicurazioni, for the XPRIMM Newsletters stated.
"Also there is the possibility of accessing an credit for agricultural investment or the legislation that will bring the Romanian agriculture closer to the European practices, will intensify the positive evolution of this segment", the quoted official mentioned.
"Romania's geographic position, its big enough agricultural surfaces and the climate are some of the elements that place Romania in a very good spot on Europe's economic map. A proof of that is the highest number of investors that have taken over large areas, due to the favorable conditions", George RADU, General Manager ASIGEST Agri Insurance Broker mentioned.
The general perception is that the agricultural insurance segment will register a positive dynamic, according with the positive factors mentioned above.
And in order to prove all of the above we should think about the fact that the agricultural financing programs have a mandatory insurance component (for machinery, deposits, farms) thus it is possible that the agricultural insurance will have the sharpest growth rate of all types of insurances as George RADU feels.
by andreea.ionete@mxp.ro, 15.02.2007

ASIGEST Agri grows one year like others in...
The first and the only insurance broker on the agricultural insurance segment, ASIGEST Agri, ended its first year with a new name ASIGEST and with a double amount of mediated premiums than 2005.
"Though at the beginning of 2006, estimations seemed to be more than optimistic, the results obtained were in the stipulated margins, in principal because of the costumers portfolio expand in the agriculture sector from Romania. Of course, agriculture insurances were in top during the APRIL-MAY campaign and November-December campaign, when the period is optimum for the insurance of risen crops", George RADU, General Director of ASIGEST Agri exclusively declared for XPRIMM Newsletters.
George RADU makes the following comments as regards the evolution of this segment in 2007: "The Romanian's geographic position, the agricultural surface, the peculiar climate are elements that advantage Romania on the Europe's economic map and a proof in this direction is the major interest of the foreign investors, who have purchased large area of land to explore and continue to come in all Romanian regions. From this point of view, it's normal for agricultural insurances to have the same growth rhythm.
"Personally, I believe that agricultural insurances will increase more rapidly than other insurances", the ASIGEST Agri"s official added.
by vlad.panciu@mxp.ro, 13.02.2007

Ambitious plans for CARDIF Asigurari
CARDIF Asigurari, the Romanian branch of BNP Paribas Assurance, intends to develop the products of financial protection for credit institutions and banks from Romania.
The company is the second in the world and the first in the Central - East Europe on the segment of insurance products attached to credits, generic named Payment Protection Insurance.
"We want to have in Romania the same success as our colleagues from other countries, either we refer to Asia, Europe or South America", Carmen BAHRIM, CEO of CARDIF Asigurari declared for XPRIMM Newsletters.
Regarding the Romanian insurance market's challenges, the insurer appreciates that a high level of competitiveness can only increase the quality of services and business environment and also creates completed products and market.
"It's obvious there are a lot of opportunities for a new entered company on Romanian market and it's not necessary for me to mention them. CARDIF is a specialized company on bancassurance and this segment is only at the beginning", the quoted official declares.
The life insurance division of BNP Paribas Assurance develops and offers saving and protection solutions distributed through alternative channels. CARDIF holds important positions in ASIA, Europe and South America, having operators in 35 countries.
"We highly believe in our arrangements' success in Romania, and knowing the East and Central European market offers us the advantage of anticipating tendencies and evolutions of the Romanian financial market", Carmen BAHRIM concluded.
by andreea.ionete@mxp.ro, 12.02.2007

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MOSCOW Re has a new owner

The Minister of the Reforms of Georgia, Kaha BENDUKIDZE sold its last Russian active membership at MOSCOW Re - one of the Russian reinsurance market leaders. This was bought by STRAHOVAYA GRUPA, one of the shareholders of STOLICHNAYA STRAHOVAYA GRUPPA, which was founded last year with the participation of the MOSCOW Bank and the investment group RUSKIE FONDI. Other companies, part of this holding are MOSKOVSKAYA STRAHOVAYA KOMPANIA and STANDART REZERV.
This acquisition completes the creation process of an insurance giant under the Moscow Administration.
On August 1st 2006, PROMINVESTITII LIMITED was the main shareholder of the reinsurance company MOSCOW Re (67.82%), with Kaha BENDUKIDZE the final beneficiary. According to the Federal Insurance Supervisory Agency (FSSN), MOSCOW Re occupies the fifth position on the Russian reinsurance market on direct reinsurance written premiums (EUR 29 millions).
"MOSCOW Re is an outstanding platform for the rapid development of the reinsurance market. The company's staff, the work technology on the market, reinsurance policy and information about the clients will be mostly preserved by the new shareholders", Serghei VASILIEV, The Head of the Directors Council of RUSKIE FONDI stated.
The Executive Director of MOSCOW Re, Serghei DEDIKOV has declared that "being a part of a large financial group implies a business amount increase".
No figures about the transaction were evolved, but according to some presumes, the sum might surpass USD 40 million.
This transaction was pretty profitable for the current Minister of Georgia who undertook the reinsurer in 2004 with only USD 20 million. The sale price was appreciated positively by the insurance market players.
"MOSCOW Re is one of the few players which evaluates risks not in comparison to western experience, but according to the domestic realities. This way, MOSCOW Re, by being part of a large holding will become stronger", Executive Director of the insurance company ENERGOGARANT, Anton LEGCHILIN has declared.
by irina.galasanu@mxp.ro, 22.02.2007

Russian reinsurance market has dropped 20%
For 2006, Russian companies obtained according to the agreements of entering reinsurance premiums, EUR 2.32 billion and paid reinsurance losses of EUR 502.9 million. In comparison to 2005, the collections were reduced by 20%, and payments increased by 60,2%. The relationship of payments to the reward is 21,7%. According to the activity of companies in 2005, the level of payments was equal to only 10,8%.
In the opinion of the Deputy Director of the Economic analysis and Evidence Department under Federal Insurance Supervisory Agency (FSSN), Yana MIROSHNICENKO, the increase of the paid losses based on written reinsurance premiums decrease represents an optimistic tendency.
As a result the coefficient of payments also grows.
"In this context, the market is recovering. I consider that in essence the decrease of the volume of collections was influenced by figures that accomplished the pseudo-reinsurance operations, directed not towards an increase in the financial stability of the companies, but to some other purposes", she says. "Such companies remain, but the volume of their premiums decreases", Deputy Director added.
In the structure of the written premiums, property risks predominate (71,6% or EUR 1.66 billion). Other 12,6% and 10,1% were for personal insurance (EUR 293.3 million) and the liability insurance of responsibility ( EUR 235.5 million). Collections on life reinsurance were 2,9% (EUR 66.8 million) and on MTPL reinsurance - 2,5% (EUR 57.8 million).
In this period, 287 companies had signed reinsurance contracts. At the same time, 310 companies paid losses. The first ten companies by the volume of the written premiums, collected 38,4% (or EUR 890.7 million) from the total amount of written reinsurance premiums. The leaders of the Russian reinsurance market for 2006 are: KAPITAL Reinsurance, RUSSKII SCIT and ZOLOTOY GARANT.
by irina.galasanu@mxp.ro, 13.02.2007

AFK SISTEMA and ALLIANZ SE have signed the agreement according to which the german shareholder redeems 49,2% of ROSNO insurance company. The price of the transaction was USD 750 million, and as a result ALLIANZ SE increased its share up to 97 %.
It is the largest transaction for all history of the insurance market of Russia.
"We are completely satisfied with this transaction", - president of AFK SISTYEMA, Alexander GONCHARUK, has declared. Our partnership initially assumed, that the control will be concentrated at the certain stage of development of the company in hands of one of key shareholders", he noted.
"With purchase of the ROSNO we expand our positions as the company number one in Central and Eastern Europe, and also, it will allow us to become the most influent foreign insurance company on strategic Russian market. This step emphasizes the importance of the CIS in general, and Russia in particular, as the basic markets that will advantage the future grow of ALLIANZ. We shall continue to realize our strategy of gaining new clients in the basic markets of Central and Eastern Europe and the CIS countries", - Verner ZEDELIUS, Member of Board ALLIANZ SE has declared. Since 2001, when ALLIANZ became one of the shareholders of ROSNO, AFK SISTEMA and ALLIANZ have transformed ROSNO into a quickly developing and profitable insurance company.
ROSNO has become the second Russian subsidiary of ALLIANZ., as the German concern already owned an insurance company ALLIANZ-RUSSIA, who has been working on the market since 1990.
Financial holding ALLIANZ, was founded in 1890 and owns 700 companies in 77 countries. In 2005 , the company's total income came to USD 100,9 billion and USD 4.4 billion of net income.
Insurance company ROSNO was created in 1991. Before the transaction AFK SISTEMA owned 49.2 % of ROSNO and ALLIANZ - 47.4 %.
ROSNO Holding includes six insurers and one operating company, with more than 100 branches across Russia, serving more than 7 million private clients and 50,000 corporate clients.
Its gross premiums rose 35 percent to USD 591 million in the first nine months of 2006 comparing to the same period a year earlier. Net income increased 12 percent to USD 22.1 million.
by oleg.doronceanu@mxp.ro, 22.02.2007

All-Russia Conference on Reinsurance is waiting for its guests
As the beginning of the 11th edition of the All-Russia Conference on Reinsurance is approaching more and more leaders and specialists from all over the Europe and CIS are registering to this important Conference, that will be held traditionally, between the 29th and 30th of March 2007, in Moscow, Russia.
This important event focuses on successfully managing the challenges that insurers and reinsurers face in developing a prosperous and trusted market segment for this industry and its clients. The conference offers the participants a great opportunity to obtain an overview of the reinsurance market in Eastern Europe, CIS and Asia; to learn about successful strategies that have been applied there; and to network with the speakers and other international and local attendees.
The PRIMM Insurance&Pensions Magazine is Media Partner of the Conference.
by oleg.doronceanu@mxp.ro, 22.02.2007

VIG increases stake in KNIAZHA
VIENNA INSURANCE Group has increased its stake in the Ukrainian insurance company KNIAZHA, from 50% to 80%, by acquisition of 100% of a EUR 3,5 million additional share issue. As a result the authorized capital of KNIAZHA increased from EUR 2,3 million to EUR 5,5 million.
"This transaction is a further step to expand the group's operations on the Ukrainian market. The Ukraine is one of the Central- and Eastern European markets in which VIG plans to further extend its market position in the future", the CEO of VIG, Gunter GEYER has declared.
VIG has been the majority shareholder in KNIAZHA since 2005, headquartered in Kiev. In 2006, KNIAZHA achieved a premium volume of approx. EUR 8 million (an increase of about 60 percent) and is working throughout the Ukraine with about 30 branches.
The largest of the three Ukrainian insurance companies of the VIG is active in non-life business - mainly in motor third party liability insurance and casualty insurance.
Also, VIG operates in the Ukraine through two others insurance companies: JUPITER (Life) and GLOBUS (Non-life).
VIG is the leading Austrian insurance group in Central and Eastern Europe and operates (through subsidiaries) in Belarus, Bulgaria, Croatia, the Czech Republic, Georgia, Germany, Hungary, Liechtenstein, Poland, Romania, Russia, Serbia, Slovakia and Ukraine, and also branch offices maintained in Italy and Slovenia.
by oleg.doronceanu@mxp.ro, 15.02.2007

ZURICH Financial Services receives control over the NASTA Insurance
ZURICH Financial Services (Zurich) and NASTA Insurance Company (Russia) have signed an agreement for the purchase of 66% stake in Russian insurer's capital with an agreed path to 100% ownership by 2010. Both parties do not disclose the price of the transaction. Pavel SAMIEV, Expert RA analyst, estimates NASTA at USD 100-150 million and controlling share at USD 70-80 million Anjela DOLGOPOLOVA, analyst of INTERFAX Center of Economical Analysis, estimates the insurer at USD 170-200 million and controlling share at USD 100-130 million, according to the Russian's insurance portal, ASN.
"The acquisition of the NASTA Insurance will place our group among the leaders of the Russian insurance market, which has a strong potential of development in the near future, ZURICH officials have declared.
Insurance company NASTA was established in November 1993 and developed a regional network that includes 67 branches and over 300 representative offices across Russia. Company is licensed for 19 insurance classes under 65 rules, and reinsurance.
In 2006, the company's total premiums came to USD 230 million, and paid claims of USD 106, 3 million.
ZURICH Group was founded in 1872, headquartered in Zurich, Switzerland. Global network includes subsidiaries and offices in North America and Europe as well as in Asia Pacific, Latin America and other markets.
In Russia the company has operated since 1992, and in 1996 was incorporated into ZURICH Financial Services Group and its 100% subsidiary.
by oleg.doronceanu@mxp.ro, 15.02.2007

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XPRIMM Newsletters


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