Fee war between brokers and regulator

Companies invested significant amounts in promotion and advertising for their policies. However, limiting the brokerage fee has lowered revenues for both brokers and insurance companies. One broker, Power Insurance, appealed the regulation change to the Court of Appeals in the southeastern city of Constanta which ruled to suspend this. The ruling is not final, as it can be appealed to a higher court. So far, the decision has not been legally communicated to the commission, according to Marinela Nemes, General Manager of CSA’s General Legal Department. She added that the decision by the Court of Appeal is only applicable to Power Insurance, and has no impact on the rest of the market. However, lawyers for several insurance companies say the court ruling, although not final, should be applicable to all companies.Meanwhile, CSA asked all insurers selling RCA policies to ‘urgently’ provide information related to contracts signed with Power Insurance. “The next court date for this trial is 14 January. Our goal was to collect evidence,” Nemes added. In December, CSA licensed 16 insurance companies to sell RCA. Most of these companies are selling their policies both through their own agents and through insurance brokers. In the first nine months of 2008, insurers registered €1.1 million in premiums for car insurance, of which RCA made up €372 million. (D.D.)