PAID contracted the IT service provider and will issue policies starting July 1, 2010
 The Pool of Insurance Against Disasters (PAID) has signed a contract with the company ESSENTIAL Systems, for the purchase and realization of the IT system that will manage the policies sold by the company, according to statements of Marius BULUGEA, General Manager of PAID, at a specialty seminar. The system will be a complex one, based on MICROSOFT technologies and IBM infrastructure, and will enable the monitoring of the penetration degree of mandatory insurance at national level, and also it will provide lists of the uninsured persons.
According to the quoted official, the Law of mandatory household insurance will be implemented most likely from July 1st, but this is conditioned by several issues, including the establishment of a database and concluding the reinsurance contract.
"While at this moment PAID is practically functional, the establishment of a database containing information about insurable households at national level takes time", explains Bulugea. Thus, some 4,000 city halls throughout the country must provide data regarding the households, and over 60% of the information available is on paper format, which requires a thorough processing. In this regard, "we will conclude protocols with ministries, prefectures, county councils, associations of villages and towns, to provide us with lists of insurable households", adds the Manager of PAID.
Regarding the reinsurance contract, negotiations are currently on-going with profile companies such as WILLIS, AON, GUY Carpenter, RFIB and STELLAR Re, which will provide, in the next period, the estimated price of the reinsurance contract.
Taking these issues into account, "it is difficult to give an exact date for the enforcement of the law. 2010 will be a year of start and I estimate a degree of insurance coverage of 20-25%", concludes Marius BULUGEA.
PAID shareholders are showing confidence regarding the implementing of this law, so "we will have a high penetration degree for the mandatory household insurance and we will, at the same time, sell other policies, such as health insurance, unemployment insurance etc.", says Radu MUSTATEA, Member of the Management Board of PAID and President of the Directorate, ASTRA Asigurari.
PAID was established in September last year by 13 insurance companies, with a contribution of EUR 4.5 million to its share capital. "Insurance policies will be printed by PAID and sold by insurance companies members of PAID, bearing the name of the company that issued them", said Angela TONCESCU, ISC President.
Remember that ISC and the Ministry of Interior signed a project for modifying the Law 260/2008 (on the basis of recommendations received from insurance companies) that, after receiving approvals from the other ministries, will enter into debate in Parliament. It says, basically, that "claims are to be paid by PAID, and not by the insurers, as PAID collects the insurance premiums", said Angela TONCESCU.
According to the current provisions of law, concluding the mandatory household insurance will be done on the basis of annual insurance premiums worth EUR 10 or EUR 20, depending on the type of dwelling, the sum insured being EUR 10,000, respectively EUR 20,000. Failure of individuals or legal persons to comply with the obligation to insure the household is a contravention and is punished with a fine from RON 100 up to RON 500.
Also, according to ISC, the degree of voluntary insurance coverage of the national housing stock (approximately 8.5 million homes) is around 15%.
Author: Oleg DORONCEANU
on 18.03.2010
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