Gov’t caps RCA rates for six months

The Romanian Government adopted, on Wednesday, the Government Decision that provides for the capping of the price of RCA car insurances for six months. Prime Minister Nicolae Ciucă announced at the beginning of the Government session that he will condition this ceiling on the elaboration in six months of the legislative amendments to ensure the avoidance of such slippages on the insurance market.

RCA rates are to be capped for the next 6 months, at the level of their own premium prices charged by each RCA insurer on February 28, 2023, according to the Financial Supervisory Authority (ASF) draft project.

The ASF representative, Cristian Rusu, said in the meeting that the elements of this government decision refer to the effective sale of RCA policies for the next six months, and these tariffs calculated and offered to insurers will be those from the end of February 2023.

He stated that the distribution commissions will also be capped, at the level of 8%, and all insurers will calculate these rates at the B0 level, meaning the basis from which any calculation starts that will later be boosted or malused depending on the claims history and their behavior in subsequent years. This will also apply to BARs, the Bureau of Insurers from Romania.”

“We all agreed, we made our commitment and everyone agreed to this measure, applicable for six months”, the ASF representative said.

The decision comes after one of the biggest insurers on the Romanian market, Euroins, went bankrupt in March.