​The Financial Supervisory Authority (ASF) wants to propose to the government to extend the RCA price cap for another 3 months, until January 10, 2024, citing the fact that all the RCA policies of the bankrupt insurer Euroins are coming to an end, several government and government sources told HotNews on Tuesday. and from the insurance industry.

We remind you that in the context of the bankruptcy of Euroins, the Ciucă government decided to limit RCA prices to the level of basic prices (B0) practiced by insurers on February 28, 2023, to which the reduction or increase in price related to the bonus-malus class is applied according to the location of each insured.

Prices have been frozen from April 11, 2023 for 6 months ending on October 10, 2023.

Sources: The government will extend the term of RCA Euroins policies, after which it will also expand the maximum price of RCA

The problem is that there are many Romanian drivers who still have valid RCA policies with Euroins, the bankrupt insurer, and these policies will automatically expire on September 8, 2023.

At the suggestion of the ASF, the Government put out for public consultation a draft regulation that would extend the validity of RCA policies issued by Euroins by another 3 months, the Economic and Social Council (CES) approved it last week, along with the observation that the measure would put a lot of pressure on Guarantee fund of policyholders, but the executive power has not yet approved it.

• “It is quite likely that this project of GEO on the extension of the validity period of RCA Euroins policies will be approved at the meeting of the Government this week.
• Later, the ASF will also propose to the Government an extension of the RCA ceiling price, which will be done by the Government in another regulatory act.
• Prime Minister Cholaku has already agreed to this proposal,” a source close to the process told HotNews.ro on Tuesday.

The information is also confirmed by other government and insurance sources.

• “ASF wants to extend the RCA price cap for a further 3 months, until 10 January 2024, but this measure will be taken by the Government by way of a decision and also requires the approval of the Competition Council as the extension is made under competition law. However, there is no official document,” a government source told HotNews.ro on Tuesday.

“I also heard this from the ASF. I was told the reason would be the expiry of all Euroins policies. I have not seen the draft of the GD.” WITHput another state source.

RCA prices may rise significantly after the end of the cap

However, other sources say there are other reasons for RCA’s price cap expansion.

• “Extending the validity period of Euroins policies is just an excuse. In the absence of a cap imposed by the government, RCA prices will rise by at least 25-30% across almost all vehicle categories from January 2024 because insurers can make these hikes and also because there are fewer players left in RCA. market
• Extending the RCA price cap would be a populist PSD measure. In addition, the current president of the ASF, Niku Marku, hopes for a new mandate at the head of the body and wants peace in the insurance market,” says another source.

On the other hand, another source said, the fear is not only about price increases, but also about a possible new large concentration in the RCA market with two leading players who owned more than 70% of all RCA insurance companies and subsequently left. bankrupt, another insurance industry source said.

There are over 1.6 million RCA insured cars on Euroins streets

According to HotNews.ro, currently more than 1.68 million RCA policies issued by Euroins are still valid, while there are more than 7.28 million RCA policies in force in total.

HotNews.ro reported back on August 9, 2023 that RCA-insured drivers in Euroins have so far submitted only 63,000 requests to cancel their car insurance policies, according to representatives of CITR, the judicial liquidator of the bankrupt former RCA leader.

Given that one in four RCA-insured cars has a Euroins policy that automatically expires on 8 September, the ASF has proposed a 3-month extension to the Government.

• Read more: Very few drivers have given up their RCA policies from Euroins, which automatically expire on September 8. ASF is asking the government to intervene