PAID, the insurance pool against natural disasters, has reported a number of 800.000 written premiums, in only one year, according to Adrian Marin, president of the National Union for Assurance and Reinsurance Companies (UNSAR). This statement was made during the 8th edition of ICAR Forum (The International Forum on Catastrophic Risks and Housing Insurance), organized this week by Media XPRIMM. This covers 10 percent of the national housing fund of approximately 8.3 million. Another 3 million optional insurance policies, with additional coverage, have been signed up to now.
Since the law 260/2008 that makes the insurance of property against natural disaster mandatory, came into force, the level of insured property increased from 15 percent to 45 percent. Before the law was implemented, in the first half of 2009, about 1.88 insurance premiums for housing were registered. In the first half of 2011, 3.38 million insurance premiums for housing were written, with 2.79 million going towards optional insurance schemes, and only 0.59 for the mandatory one.
Romania’s market share in CEE (Central and Eastern Europe) reached 6.8 percent on H1 2010 and climbed to 7.4 percent in the similar period of 2011. The volume of gross written premiums in the first half of 2011 totaled EUR 159.5 million. The property insurance market of the CEE, in the same time frame reached EUR 2.2 billion.
According to Marius Bulugea, General Director of PAID, the residential exposure in Romania is EUR 105.6 billion, with EUR 60 billion distributed to the urban areas.
For Bucharest, the residential exposure exceeds EUR 12 billion. In Romania’s capital, 150.000 insurance premiums have been written for property, which is 18 percent of the total residential fund.
The price of a mandatory insurance against natural disasters is EUR 20 for type A buildings, mainly in the urban areas, covering claims up to EUR 20.000, and EUR 10 for type B buildings, mainly in the rural areas, covering claims up to EUR 10.000. Building owners that haven’t insured their property will be fined, according to the current law, with sums ranging from RON 100 to 500.
Romania is the only country in the EU 27 that has adopted mandatory insurance against natural disasters.
PAID, the insurance-reinsurance company created in November 2009, has 12 shareholders and a reinsurance protection fund of EUR 300 million, guaranteed by Swiss Re, Munich Re, Hanover Re and other leading reinsurance companies.