CSA takes auto liability policies off the streets

The Insurance Supervision Commission (CSA) has forbidden insurance companies to sell auto liability policies (RCA) on the streets, at street stands or in cars. “Companies must sell these policies on their own premises or at the agents’ places, not like tomatoes at the market,” said Angela Toncescu, chairperson of the Insurance Supervision Commission Council.
This is the first step Angela Toncescu has taken since her appointment as CSA chairperson, sending a memo to insurance companies several days ago. She was selected for this position on July 4, 2006, nominated by the National Liberal Party.
This measure had been expected, with the former CSA chairman, Nicolae Crisan, recently saying CSA was preparing a regulation regarding this matter.
Angela Toncescu explained that the policy and policyholder identification details had to be sent to the new CEDAM database in a very short time. The database checks the number of insurance policies against the number of cars registered.
Moreover, policies filled out under improper conditions may contain errors that are hard to rectify, so that insured clients may not show up as such in the CEDAM database.
It is hard to say how many of nearly 3 million RCA policies are sold outside of insurers’ premises. However, this is widespread practice throughout big cities.
The CSA chairperson explained insurance companies were responsible for the place their policies are sold and not the agents, who sell these policies by proxy. Those that do not comply will receive a warning, or even have their right to sell auto liability policies suspended.
“It’s a good idea. The problem I see here is that we cannot always control this phenomenon. I don’t know who sells, in what market or through what stand. We too have problems with agents selling wherever they please. The decision is very hard to apply,” stated Octavian Manastireanu, general manager of Ardaf, a company whose portfolio is over 50% comprised of RCA policies. Could sales go down? “As far as I’m concerned, sales shouldn’t go down for this reason,” Manastireanu said.
Liviu Stoicescu, head of auto insurance department of Omniasig and chairman of the Bureau of Auto Insurers in Romania says those that sell on the streets are the so-called RCA brokers. “These are small brokers that develop a parallel operation to the insurance company,” Stoicescu said.
He says the regulation can be applied.
“It is a matter of will on the part of the insurer. The agent and brokers have to be punished, too, because they fall under the jurisdiction of the CSA. How I am to blame for some agent of a broker that sells a policy at a street stand, if I warned all my brokers and agents not to do it?” Stoicescu concluded.
Toncescu was the manager of Asirom until 2004, one of the top three insurance companies in Romania and among the few big companies that are still Romanian held, controlled by businessman Ioan Niculae through the Interagro group.