Insurance market posts 40% growth to $480m

The insurance market in the first eleven months of 2002 amounted to 15,051bn ROL, namely $456 million, the representatives of the Insurance Supervision Commission estimate. The full-year market – the total gross premiums collected would therefore amount to $480 million.
The data for the entire year are not available yet, but if considering a $40-$41 million monthly average for the entire market and December premiums worth at least half this average (due to the Christmas holidays), the total insurance market reached approximately $475-$480 million. This accounts for an about 40% increase, which is much higher than in the last few years: 11% in 2001, 12% in 2000 and 3% in 1999. How come?
“It is obvious the growing economy had a hand in this, but there’s one more thing. The fact that the market increased in spite of the many insurers that lost their right to issue policies last year shows how much potential this sector has; we feel a credibility gain for insurers is important,” Nicolae Crisan, chairman of the Insurance Supervision Commission said.
CSA last year imposed special supervision procedures for more than five companies, two of which are heading towards liquidation (Adas, Grup AS), while others have lost the right to issue policies in the meantime.
Yet, the insurance market was not propelled by higher demand only. The September 11 attacks and the collapse of the stock markets thereafter pushed reinsurance prices and implicitly insurance premiums up.
“The general insurance premiums – especially where the property insurance (fire and other damages of goods i.e.) is concerned, went up by about 10%-20% in dollars on the average last year, with a similar growth projected for this year, as well,” said Mihnea Tobescu, general manager of AIG Romania (the Romanian branch of the leading insurance company in world in terms of market capitalisation, AIG).