Prima pagină » English » Romania Might Enforce Mandatory Home Insurance Law As Of July 1

Romania Might Enforce Mandatory Home Insurance Law As Of July 1

Romania’s first mandatory home insurance policy might be issued in July if PAID, the company issuing mandatory home insurance policies, manages to conclude the reinsurance contract with reinsurance brokers, PAID managing board member Radu Mustatea said Monday.
Romania Might Enforce Mandatory Home Insurance Law As Of July 1
17 mai 2010, 11:55, English

According to Mustatea, general manager of insurer Astra, the reinsurance contract has been broadly outlined.

Mustatea added that negotiations for the reinsurance contract of the Insurance Pool against Disasters, or PAID, have already begun with brokers Willis, AON, Guy Carpenter and Stellar Re.

In September last year, 13 insurers signed the documents establishing PAID, a joint stock insurance-reinsurance company that will manage the risk fund meant for paying damages in case of natural disasters. The 13 contributed EUR4.545 million to the company’s share capital.

Local insurers Astra, Clal Romania and Groupama Asigurari have a 15% stake in PAID, while ABC Asigurari, Ardaf, Carpatica Asig, Certasig, City Insurance, Credit Europe Asigurari, Euroins (former Asitrans), Generali and Grawe Romania have a 5.5% stake each.

The law regulating mandatory home insurance, adopted in November 2008, states that homeowners have to get insurance policies and pay premiums ranging from EUR10 to EUR20, insuring homes for EUR10,000 to EUR20,000. The law does not regulate non-mandatory insurance policies, which owners can take out for sums over EUR10,000-EUR20,000.

The fine for not taking out a mandatory insurance policy will range from RON100-RON500.

According to data provided by Romania’s insurance watchdog, or CSA, only 15% of the country’s eight million homes have been insured thus far.