The Romanian Financial Supervisory Authority (“FSA”) recently released its report on the local insurance market indicators.

As of 30 June 2017, all insurers in the market met the minimum capital requirements (“MCR”) and the solvency capital requirements (“SCR”) under Solvency II. The insurers’ eligible own funds covering the MCR were slightly above EUR 1 billion, whilst their own funds covering the SCR were slightly above EUR 1.07 billion.

The life insurance and non-life insurance markets proved good liquidity;, with the life insurance liquidity at a ratio at 5.03 and the non-life insurance liquidity ratio at 2.63.

Interestingly, from an investment perspective, local insurers invested their assets as follows:

  • 70% in state bonds;
  • around 10% in UCITS;
  • 7% in bank deposits; and
  • about 1% in equity and high-yield financial instruments.

This shows that insurers are being more cautious with investments and have less of an appetite for riskier, potentially high-yield investments.

The FSA concluded that the insurance market in Romania is more stable than in the past, which could indicate a trend in the market.

For additional details regarding the insurance market’s trends in the first half of 2017, please read our earlier article here.