Ionel DIMA, AVUS: If an insurer makes higher profits on the motor segment, something is wrong
Motor insurance gives headaches to the Romanian insurers, the more so now, in times of crisis, when to the increasing claims rate there are also added the decrease of the underwritings and the customers' tendency of self-insurance. In the view of specialists, this insurance segment is one that consumes many resources, generating small profits.
"I do not consider motor insurance to be a very profitable line. If you manage to stay on the floating line, with a small profit of 5-10%, is fine. If the insurer makes higher profits on the motor segment, something is wrong... The decline of the motor share in the market, in 2009 and 2010, has at least the advantage of balancing the portfolio and of forcing the insurers to strive harder on other lines of business", said Ionel DIMA, Vicepresident, AVUS International.
In terms of measures that would make the Romanian motor insurance market more profitable, Ionel DIMA considers increasing the premium of the MTPL policy, increasing the number of complex products and "modeling" the Motor Hull franchise to be the key measures that can be taken to stabilize the situation on this business segment. Outsourcing services on the claims segment is also one of the cost reduction solutions for insurance companies.
"70% of UK companies have outsourced almost all services. Over 30% of companies on the continent have outsourced claims, wholly or partially, the trend being ascending. AVUS is activating in Romania on claims of all insurance lines for Romanian insurers. On the motor segment, although we had requests, we have not yet taken the decisive step; we work only sporadically, punctually, thematically. I think neither we, nor the insurers are yet ready to take over <externally, en-gros> this service", commented Ionel DIMA.
AVUS Group serves nearly 1,000 insurance companies, the most important of the world, with whom there is a traditional collaboration. The group comes to meet insurance companies in giving them advice, not only for loss adjustment. Despite the economic crisis, 2009 brought to the group financial growth and organizational stabilization. However, Ionel DIMA stated that the budget for 2010 was designed with great caution.
AVUS International is the Main Partner of the Fourth Edition of the Motor Insurance National Conference, which will be held on March 4th at the Parliament Palace. Well-known specialist of the insurance market, Ionel DIMA will be the moderator of the discussions during the Conference.
Author: Oana RADU
on 25.02.2010
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