Insurers can no longer afford to wage a price war, says Generali

Insurers' profitability could improve this year because the shareholders can no longer allocate resources to fight their competitors on a price basis, which has happened over the last few years and generated major losses to the insurance market, says Marie Kovarova, general manager of Generali Asigurari, one of the leading companies on the insurance market. "Perhaps newcomers will still do that, in their bid to gain market share, but older players can no longer afford to enter the price war. 2010 will be a better year in terms of profitability, we noticed that RCA (auto liability insurance) prices were more reasonable," says Kovarova, who took over at the helm of Generali Asigurari in September 2008. The Romanian insurance market has seen net losses for a few years, with the main reason for this being the big claims recorded in the auto insurance sector, according to the companies, as well as the fact that some players are seeking to gain market share by charging low prices.