The Financial Supervisory Authority (ASF) decided on Wednesday to suspend the payment of the contribution that RCA insurers pay to the institution, a contribution that is included in the RCA’s final price. The measure will operate for 6 months after adoption to effectively offset the RCA’s 6-month price freeze.
Specifically, RCA insurers will no longer contribute 1% of gross premium (PBS) in this segment until the end of the RCA price freeze period.
The proposal is included in a draft rule that was voted on by the ASF Board on Wednesday.
The project is planned to be submitted for public discussion within 10 days.
We remind you that from April 11, RCA prices cannot exceed the maximum level from February 28, 2023, after the adoption of the Government Resolution on this.
Maximum prices are set on an insurer-to-insurer basis based on the prices used by each company on February 28.
RKA insurers will no longer pay ASF contributions until the end of October
Together with the RCA price cap, the suspension of the 1% contribution paid by insurers to the ASF is a measure aimed at stabilizing the RCA market after the collapse of the Euroins, given that administrative costs (and therefore also taxes and contributions) are a component of RCA tariffs.
The suspension of the 1% RCA premium will be in effect until the end of October, given that the ASF decision will come into effect later than the HG that capped RCA prices.
What was the revenue of RCA Insurers in 2022 and which players are still in the market
At the moment, there are eight insurance companies selling RCA on the Romanian market, after Euroins lost its work permit, ASF found that the company did not have the necessary tools to guarantee the payment of obligations. More specifically, Euroins had a capital shortfall to cover its solvency requirements (SCR) of more than €400 million.
Eight active companies: Groupama (insurance market leader at the end of 2022), Allianz Țiriac, Omniasig, Asirom, Grawe, Axeria Iard, Generali and HD Insurance.
In 2022, eight companies signed a total premium of approximately 5.3 billion lei.
Source: Hot News
Lori Barajas is an accomplished journalist, known for her insightful and thought-provoking writing on economy. She currently works as a writer at 247 news reel. With a passion for understanding the economy, Lori’s writing delves deep into the financial issues that matter most, providing readers with a unique perspective on current events.