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Asirom: We lost 20% of customers in auto liability insurance campaign after raising prices

Asirom: We lost 20% of customers in auto liability insurance campaign after raising prices
24.02.2009, 17:56 8

Asirom, the third largest player on the insurance market, saw its number of customers go down by 20% (60,000 policies) during the auto liability insurance campaign that has recently ended in the wake of the rate increase. "We've lost a lot of customers because we had 30-40% higher prices than in the previous campaign, and people went to companies with lower prices. Overall, we sold around 240,000 policies," stated Boris Schneider, CEO of Asirom, a company owned by Vienna Insurance Group.

The auto liability insurance campaign is carried out during the December-January period, when drivers largely renew their policies. Many insurers are counting on these months to significantly boost their turnovers and are running extensive advertising campaigns to lure as many customers as possible. Auto liability insurance customers are important as companies subsequently try to sell other policies to them.
Asirom ended this year's auto liability insurance campaign with gross underwritten premiums worth 90-100m RON (22-25m euros). "Despite our losing customers, at the level of gross underwritten premiums we saw an increase by several percentage points, as the average premium has increased. I believe auto liability insurance will this way become a profitable business," Schneider said.
The head of Asirom is 45 and is Austrian-born. He came to the helm of the company in 2005, after having worked with Vienna Insurance Group. Last year, Schneider renewed his management contract for another three years.
He says that besides a bid to drive auto liability insurance sales into the black, prices were raised on the higher claim settlement limits. From 2008, these limits doubled.
"I believe the rate hike was a good decision. In a difficult economic environment, like the current one, one must boost profitability to survive on the market," specifies Schneider.
Asirom was not the only insurer to raise auto liability insurance rates.
Schneider says Asirom was in the black last year in line with the reporting standards of the group the company is part of, but he did not specify the value of income.
According to the latest data released by the Insurance Supervision Commission, Asirom ended last year with total turnover worth 748.4m RON (203.2m euros). In euros, the increase in total gross underwritten premiums revolved around 8%.

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