“2013 will be similar to the year before, I don’t expect major changes against 2012 and the performance of the first three months of this year confirms this. I expect a rise of 5% at the most this year for premiums written at market level,” says Mihai Tecau, head of Omniasig.
The insurers’ written premiums rose 6% last year, to 8.3 billion lei (EUR1.9 billion). Most insurers expect a rise of less than 5% this year for premiums written. Insurers started on an upward trend last year after four years of decline.
However, the insurance market cannot grow unless the economy accelerates its rise because insurance sales are strongly connected to macroeconomic performance. If Romanians’ income stagnates or diminishes, they will cut the budget dedicated to insurance, which is not a priority.
“We expect the rising trend recorded in the past year to continue and [for the market] to see 5% growth this year. We cannot talk about double-digit growth yet because the economic situation both internationally and locally remains difficult,” says Florin Golovatic, head of Astra.
All insurers cite the dependence of the insurance industry on macroeconomic performance and admit that premiums written won’t rise unless the economy sees a faster and steadier growth.
“Considering that predictions for the entire economy are cautious, a 5% rise [for the insurance sector] is optimistic,” explains Mariana Diaconescu, head of Asirom.
Although he doesn’t expect spectacular changes to the market structure and the dynamic of policy sales, Marian Mirzac, head of Carpatica Asig, says underwriting could rise if the economy went up by 2-3% amid a rebound of consumption and an acceleration of investments.
The head of Generali, Adrian Marin, does not expect a rise of the market this year, but hopes the market will find a balance.
“For 2013 we don’t expect significant rises, but we hope for a balancing of the market, we hope to see a healthy market, with a balanced portfolio,” Marin says.
The insurance market is still around 50% dependent on sales of auto policies.
There are also those who say the industry will see double-digit growth in 2013 despite the difficult economic context, and that the growth driver will be the higher prices of RCA policies.
“I believe the insurance sector will recover in 2013, even if the economy is not in the best shape. I anticipate a double-digit rise for the entire market and I think the stars of the year will be health insurance policies. It is important to keep in mind that decisive contributing factor to market growth will be the increase in the price of mandatory auto policies (RCA),” says Iulius Alin Bucsa, head of Astra.
(English version by Daniela Stoican)