CSA: Romania's Insurance Sector 2010 Net Loss At RON41M, 59.9% Lower On Year

05.24.2011 By Gavrila Oana

Romania’s insurance industry registered a cumulated net loss of 41.37 million lei (EUR10 million) in 2010, lower by 59.9% compared to the level posted in 2009, Tuesday said Angela Toncescu, head of the country’s insurance watchdog CSA.

In 2009, Romanian insurers posted a cumulated net loss of RON103.25 million, from RON582.46 million in 2008.

"The lowering of losses in the industry shows insurers were careful spenders during a year of crisis and have managed to improve their bottom lines," said Toncescu at the 14th edition of the International Insurance-Reinsurance Forum.

According to CSA data, the number of insurers that turned profit last year stayed at 20, while the number of insurers that registered loses decreased to 23 from 25 in 2009.

Also, the 23 companies registered a cumulated loss of RON276.64 million, 33.9% lower than in 2009.

Cumulated profits of the 20 insurers that turned profit stood at RON235.27 million, 25.3% lower than in 2009.

At the end of 2010, the 43 insurance companies authorized to operate the Romanian market had a total share capital of RON4.175 billion, 5.1% higher compared to 2009.

"The increase in share capital shows insurers want to keep their Romanian businesses despite the temporary decline in underwritings. In 2010, 19 insurance companies raised their share capital by a total RON400 million," Toncescu said.

She added there are signals that several insurers wish to enter the Romanian market but no one is willing to sell their business.

In 2010, French group AXA bought Omniasig Asigurari de Viata, whose operations have been officially launched this month.

Also, Ergo Asigurari de Viata made its debut on the Romanian market last year, by selling life insurance policies through UniCredit Tiriac Bank.

CSA data shows foreign investors hold 88.6% of the share capital in the Romanian insurance industry, namely RON3.69 billion. French investors own a 29.1% share, followed by Austrians with 24.6%, Dutch investors with 14.2% and U.K. investors with 4.6%.

Toncescu also said final data indicate a 6.36% decline in underwritten general and life insurance premiums, to RON8.31 billion.

The share held by the insurance industry in the country's gross domestic product decreased to 1.62% last year from 1.8% in 2009. (EUR1=RO4.1263)