EU based companies could control 30% of Romanian insurance market

Insurance companies from other European Union member states, who have notified the Insurance Surveillance Commission (CSA) of their intention to come to Romania, could control up to 30 percent of the insurance market, said Bogdan Andriescu, President of the National Union of Insurance Brokerage and Consultancy Societies from Romania (UNSICAR).

Andriescu believes that these companies will develop insurance policies that are not presently available on the Romanian market. “I think that most of the companies that notified CSA will work through brokers and will enter all business sectors, bringing additional services. Also, some of these companies were motivated to come to Romania due to the intention of their clients to develop business here,” added Andriescu.

Companies in the European Union will report their revenues only to authorities in their country, meaning that it will be hard to quantify how much they will take from the local market. CSA will have no control over these companies, meaning that their businesses could be quantified only if they choose to work with local CSA-authorized brokers.

When Romania became part of the EU, 151 insurance companies and 387 brokers from other member states notified CSA of their intention to run businesses on the local market. About one third of these notifications are from Great Britain. “I think most of these companies chose to come here to assist their international clients,” said Catalin Stroe, Asirom Marketing Manager.

Stroe also believes that insurance companies from the EU will focus on corporate companies rather than retail. “To enter the retail market, these companies will have to develop a local infrastructure and it is unlikely that they will do this,” said Stroe.

Romania’s 38 insurance companies subscribed gross premiums in the first three quarters of 2007 worth €1.6 billion, up 18.65 percent from the same period last year. The first 10 companies control 82 percent of the local market.