Romanian insurance brokers thrive amid City Insurance bankruptcy

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The income of insurance brokers selling motor third party liability (RCA) insurance increased by 41.6% in 2021, reaching RON 792 million, according to data provided by financial market regulator ASF quoted by Profit.ro.

Revenues from Voluntary Motor Insurance Contracts (CASCO) increased by only 11% to RON 350 million.

At the end of September, before the bankruptcy of the leader City Insurance, the annual growth rate over the cumulative period January-September of income generated by RCA contracts was only 22.48%.

But something happened, the price of compulsory car insurance jumped amid City Insurance’s bankruptcy towards the end of the year, as did brokerage revenues, in the last quarter of 2021.

In the meantime, ASF has drawn up new regulations aimed at capping motor third-party liability insurance (RCA) rates and also capping the fees collected by insurance distribution companies at 5%.

The draft government decision on the matter, providing for a cap on RCA rates and the fees charged by insurance brokers for six months, is currently being examined by the competition body, the Minister of Finance announced on March 23. Adrian Caciu.

(Photo: Pixabay)

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