For the fourth year in a row the rising rate of claims has persuaded insurers to increase prices for mandatory car civil liability (RCA) insurance.
2009 is the fourth year since insurers were granted the freedom to set their own tariffs for RCA policies, and is expected to bring increases by as much as 15%, after prices this year increased by up to 55% for natural persons and as much as 100% for legal persons.
In 2006, when the Insurance Surveillance Commission (CSA) stopped setting a range for RCA prices, insurers raised tariffs by around 20-30%.
Allianz-Tiriac, Asirom and OTP Garancia, 3 companies out of the 13 that received the green light from CSA to sell RCA policies next year, have already published their 2009 tariffs on their websites. The tariffs must be published, as policies are valid for one year after the policy is signed, and therefore the price levied in early February 2008 covers 11 months of 2008 and one month of 2009.
Allianz-Tiriac, leader of the insurance market, raised tariffs for RCA policies purchased by companies between 8.3% and 11.4% against 2008 depending on the engine capacity of the insured vehicle.
"These prices were calculated after we referenced statistical data from our portfolio and took into account the claim rate (...)," states Marius Onofrei, communications manager with Allianz-Tiriac.
At present, the company registers a gross claim rate of 83% on the RCA segment, which brings losses, however a 70% claim rate would bring the company profit.
Asirom, which held the top position on the RCA market last year in terms of the value of sales, has increased prices for 2009 by between 10.4% and 12.2% for natural persons and on average by 10.3% for legal persons.
In the case of OTP Garancia (a division of Hungary's OTP financial group), tariffs for 2009 have increased by as much as 13.1% for natural persons and 14.6% for legal persons.
The rising claim rate on the RCA segment is the main factor behind policy price hikes, but prices were also influenced by an increase in insurers' liability limits.
RCA claim settlement limits will triple in 2009 from this year's value, in line with a recent CSA decision.
RCA policy price increases for 2009 come after some insurers again lifted tariffs for next year, against prices announced in the first half of this year for insurance valid in 2008. At the same time, some companies cut prices in an attempt to gain customers in December-January period when the RCA campaign begins.
Last year, the RCA market stood at 350 million euros, up 30% against 2005, a rate that may continue this year and could even be surpassed given the higher tariffs.
RCA prices in 2009
Allianz-Tiriac (leader of the insurance market): tariffs for RCA policies purchased by companies have increased between 8.3% and 11.4% against 2008
Asirom has raised its prices by between 10.4% and 12.2% for natural persons and on average by 10.3% for legal persons
OTP Garancia: tariffs have increased by as much as 13.1% for natural persons and 14.6% for legal persons
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