Romanian insurance market

The top 5 insurance groups generated around 72% of the total premium volume in Romania in the first three quarters of 2019. The two largest insurance groups generated around 37%.

Market growth in the 1st to 3rd quarters of 2019 compared to the previous year

Romania – Market growth in the 1st to 3rd quarters of 2019 compared to the previous year (bar chart)
Source: Financial Supervisory Authority ASF

The Romanian insurance market recorded an 8.8% year-on-year increase in premium volume in local currency terms. Both the non-life and life sectors contributed to this performance.

The non-life sector, which is heavily dominated by the motor lines of business, recorded a 9.8% increase. Motor third party liability, which represents around half of the non-life business, recorded its first increase of 6.1% following the declines recorded in the last two years. It must be noted, however, that the technical results in this line of business are significantly negative. The market for motor third party liability insurance is highly concentrated, with two insurance companies having a market share of slightly more than 70%. Motor own damage insurance achieved a gain of 12.2% compared to the same period in the previous year. The non-motor lines of business recorded an increase of 14.2%.

Life insurance grew 4.8% in the first three quarters of 2019. Unit-linked and index-linked life insurance generated a major gain of 40.6% compared to the previous year, while traditional life and annuity insurance fell 9.6%.

According to Axco Global Statistics, the insurance density in Romania was at EUR 112 per capita in 2018. EUR 90 of this amount was for non-life insurance and EUR 22 for life insurance.

VIG companies in Romania

Market shares of the major insurance groups

Romania – Market shares of the major insurance groups (ring chart)
Source: Financial Supervisory Authority ASF; as of 9M 2019

Three VIG insurance companies, the non-life insurer Omniasig, composite insurer Asirom and life insurer BCR Life, operate in the Romanian market. Their market share of 19.9% makes the VIG insurance companies the market leader in Romania. They hold the second place for both life insurance and non-life insurance.

Financial performance indicators in the Romania segment

Premium development

Premiums by line of business

Romania – Premiums by line of business (ring chart)
Values for 2018 in parentheses

The VIG insurance companies in the Romania segment wrote EUR 468.2 million in premiums in 2019, representing a decrease of 9.1% (2018: EUR 515.3 million). The decline was primarily due to an intentional reduction in the motor third party liability portfolio. Net earned premiums were EUR 346.9 million in 2019, or 7.2% higher than the previous year, primarily due to lower reinsurance cesssions caused by a change in the portfolio mix.

Result before taxes

A loss of EUR 101.8 million was recorded in the Romanian segment in 2019 (2018: loss of EUR 73.9 million). This development was primarily the result of a complete goodwill impairment of EUR 108.8 million in 2019 (2018: EUR 50.1 million). Without the goodwill impairment, the operating result would have been EUR 7.0 million in 2019.

Combined Ratio

Although the combined ratio improved considerably in 2019, it remained above the 100% mark at 100.9% (2018: 107.5%).