Insurers welcome deductibility, request changes

The deductibility of the earthquake insurance the new Fiscal Code introduced for individuals has not made the same impact on the revenues of the general insurance companies on the Romanian market. The Code says expenses for home insurance are deductible up to 200 euros a year. Part of the insurers say the market did move, so that demand increased, while others say they did not see any difference in the demand, and are not expecting any either, unless the deduction procedure is reorganised. Cristian Constantinescu, chief executive of the largest insurer in Romania, Allianz-Tiriac, says that people are not accustomed to filling receipts or bills, keeping them and submitting them to the tax authorities a year later. Moreover, since the amounts they get back are rather small (the insurance for an average home in a block of flats is about 100 euros and the State returns up to 40 euros i.e.), people cannot be bothered with that. He suggests this incentive should be handled by the homeowner’s employer. Steluta Racolta, Ardaf general manager says this deductibility has shown in the company’s building insurance business but admits Ardaf had a programme running to promote this type of insurance. ZF