A new private company might start selling RCA insurance in the second half of this year, currently being in the second stage of the authorization process, announced on Wednesday, at the Government, Valentin Ionescu, the general director of insurance in the ASF.
Romanians are increasingly worried regarding the price they will pay for RCA insurancePhoto: DreamsTime / Stokkete
- “At the moment we have another request that is in the second phase of authorizing a private company. This company has passed the first stage of authorization according to the gilding legislation, namely the establishment notice and now the company is bringing documents for the operating notice,” said Valentin Ionescu on Wednesday.
According to him, the operating permit will be granted sometime in June-July, if all the documents are in order.
- “This company will sell in addition to RCA insurance, CASCO insurance, health and home insurance. So we will have a new company selling RCA sometime in the second part of this year.
- Regarding the discussion with CEC, I had meetings with the bank representatives, I told them what documents to bring. We are at the stage where CEC representatives are sending documents to the authority, we are in touch with them and we hope that, as soon as possible, we will also see a state company that will sell RCA.”, declared the director general in insurance from ASF.
Why it is difficult to hope for low prices at RCA: In Bucharest 7 out of 100 cars have accidents, compared to other areas where the frequency is lower
The general director of ASF also explained on Wednesday why drivers from Bucharest and other big cities have higher prices at RCA and why it is difficult to have lower prices at RCA in general.
According to him, in big cities the load in terms of the tariff calculated by the insurance companies is somewhat higher due to the risks and the frequency of claims, which is higher.
- “Normally, to have the most reasonable rate, you need as many companies as possible to sell that insurance, as much dispersion as possible. When there are only a few companies that sell RCA it is difficult to hope for a lower rate, considering that in Romania the frequency of accidents is much higher than the European average.
- Damage is a very important element in RCA pricing. In the last 3 years, the average damage increased from 7,000 lei to 9,500 lei.
- In Bucharest, 7 out of 100 cars have accidents compared to certain areas of the country where the frequency is lower, somewhere around 4%. All these elements must be taken into account when calculating the RCA price”, he declared.
He also said that there is also a structural problem: RCA is a mandatory product sold by private companies.
- “There are some private companies that have had losses in recent years. One of the biggest companies in the market, Uniqa, withdrew from the RCA market due to accumulated losses of hundreds of millions over the past 7-8 years. As you know following the exit of City Insurance, Uniqa has applied to exit RCA insurance and we can also have situations from these.”, Valentin Ionescu also declared.
For details read: “I don’t want to comment, it seems a bit biased”: The response of an ASF executive, asked regarding the honorable resignation and performance bonuses following the City and Euroins bankruptcies
Photo source: Dreamstime.com
