​750 trucks over 16 tons received discounts of thousands of lei at RCA in the first week of applying the new calculation formula, designed exclusively for this category of high-risk insured persons. With Çolaku expecting thousands of cheaper RCA policies for trucks, insurers are hoping for tax cuts to ease the impact, while other insurers are relying on Parliament for promised changes to the RCA market.

750 cheaper RCA policies for trucks over 16 tonnes in the first week

In the context of negotiations with carriers to end the protests, the Financial Supervisory Authority (ASF) on 19 December approved a new formula for calculating the RCA premium recommended by the Bureau of Motor Insurers (BAAR) for certain high-risk policyholders, respectively for individuals and legal entities owning trucks over 16 tons of class B0.

The maximum value of the first recommended RCA will not exceed 9,000 lei for class B0, according to the new formula that will be applied during the period in which the provisions of HG No. 1326/2023 (the law limiting RCA prices) are in force. for another 3 months, the values ​​of February 2023, adjusted with a maximum increase of 6.8%).

At the request of HotNews.ro, the Bureau of Automobile Insurers (BAAR) announced that, starting on Monday, January 22, it began to allocate RCA insurers to high-risk policyholders in the segment of trucks over 16 tons with recommended premiums based on a new calculation formula.

New calculation formula: RCA premium for trucks over 16 tonnes reduced by almost 24%

By law, all policyholders who receive quotes from at least three different insurers within a 12-month period whose RCA premiums are 36% higher than the base rate for the risk segment they belong to are considered high-risk policyholders.

If you fall into this category, you can approach BAAR (the umbrella organization for all RCA insurers) who will appoint an RCA insurer to insure your car at a recommended premium.

• The formula for calculating the recommended premium for all vehicles except trucks over 16 tonnes is the arithmetic mean of the high risk premium (base rate x 1.36, which is the N factor) and the arithmetic mean of the three lowest premium values, less distribution costs, which can be found in the RCA offers that the high-risk policyholder added to the request, weighted by a percentage of 64%.
• The formula for calculating the recommended premium for trucks over 16 tons differs in that it is weighted by a percentage of 39%, which has resulted in discounts of thousands of lei for trucks, much higher than before.

BAAR data shows that the average RCA insurance premium offered by RCA insurers, after deducting costs related to high-risk cases instrumented by BAAR, in December 2023 for trucks over 16 tons was almost 16,000 lei.

What price reduction does RCA give to trucks under the new calculation formula?

• “For class B0, the recommended premium is 8,966.71 lei compared to 11,708.24 lei (the value obtained by multiplying the base rate of 8,609 lei by the coefficient N of 1.36), which represents the level of inclusion in the high risk category. for class B0.
• Before this formula came into effect, the recommended premiums for the truck segment were on average slightly below this threshold of 11,708 lei,” BAAR representatives told HotNews.ro.

Insurers are hoping for lower taxes and premiums to mitigate the effects

These RCA price reductions specifically for trucks over 16 tons, a segment in which the claims frequency is 3 times higher than the market average and the compensations to be paid are significantly higher, create a negative financial impact on insurance companies.

• Sources from among the carriers involved in the negotiations told HotNews.ro that during the negotiations the insurers raised the question of the financial consequences of changing this calculation formula and reducing the price of RCA for trucks.

The information is confirmed by BAAR, which indicates that the ASF is currently analyzing possible reductions in taxes and contributions paid by insurers.

• “After consultation, we understand that the ASF is analyzing the adoption of a set of measures to reduce the negative financial impact caused by these changes, such as reducing certain taxes and contributions paid by insurers, adjusting the bonus-malus system, introducing or proposing changes. to the regulatory acts that regulate RCA insurance”, officials of the Bureau of Automobile Insurers clarified for HotNews.ro.

Insurers: Out of 100 lei collected for RCA, 77.3 lei are intended for payment of losses and 13 lei for taxes and contributions.

Insurers’ main costs are expenses, and out of 100 lei collected by RCA, 77.3 lei go to claims, the National Union of Insurance and Reinsurance Companies of Romania (UNSAR) said earlier this month.

After the Confederation of Motor Carriers (COTAR) charged that “only 25% of the RCA policy price is the payment of claims and 75% is collected by the insurers”, UNSAR responded by claiming that out of 100 lei collected on the RCA, 77.3 lei goes on claims, according to official ASF data.

• “The main expenses of insurance companies are, were and will be the payment of claims in order to fulfill their obligations to customers. At the same time, paying out important compensations, almost 5 million euros every calendar day (and this is only in 2022), Romanian insurers come to the support of people and companies.
• Even if you want to blacken the image of Romania and the insurance market in our country, from the point of view of costs, the insurance industry falls precisely in the range of 15-30%.
• The problem is not here, but depends, among other things, on the frequency of road accidents and the average damage.
• Returning, the expenditure area shows: taxes and contributions paid to the Insurance Guarantee Fund, the National Defense Fund and other institutional bodies in the amount of 13% (therefore not belonging to insurers). Some of this money is a loan that insurers make under the law so that the FGA can pay compensation to injured parties.
• It is not known when the sums borrowed by the FGA insurers will be repaid, and what their value will then be, taking into account inflation and the loss of interest; commissions and other acquisition costs (ie insurers’ costs). During the period of limitation of premium rates, they amount to a maximum of 7.4%.
• In summary, approximately 6% of the premium remains for insurers’ administrative costs, claims adjusters, reinsurance and many other categories of costs. All other costs represent reserves for compensation of losses, the creation of which is a requirement of the law, so that insurance companies can fulfill their obligations at any time,” the insurers said.

When all RCA policy holders will benefit from the suspension of the policy while the car is parked or paid in installments

In addition to this temporary decision to reduce the price of RCA for trucks over 16 tonnes, Prime Minister Çolaku promised that in the coming period measures will be taken for the entire RCA market, such as paying in installments or suspending the policy until the vehicle is in the shop . use for a longer time.

The Financial Supervisory Authority (ASF) announced on Thursday 25 January that the possibility of RCA contract suspension, loss certificates and electronic monitoring through the RCA network of road traffic cameras are measures included in the draft law passed by the government in December and now registered in the Senate.

• Read also: Why RCA truck prices are so high: what carriers are advertising, what internal ASF data shows and what solutions are on the negotiating table