Insurers have to increase prices for auto policies, due to high costs, deems Groupama

Losses registered by the Romanian insurance market in the auto segment make it impossible for players to avoid increasing prices in 2009, declared today the Groupama official in Romania, Denis Rousset.

The French insurer Groupama predicts that the market will advance slower next year than it did this year, when it increased by 25 percent.

The insurer is currently planning the merger of its three companies on the Romanian market, Asiban, BT Asigurari and OTP Garancia Asigurari into one single entity named Groupama Asigurari. The process will be completed by the end of 2009 and will propel Groupama to third place on the Romanian market, after Vienna Insurance Group and Alllianz-Tiriac.

Groupama officials admitted that the price paid for the three insurers could have been smaller had the transactions been closed before the financial market got more turbulent.

Groupama aims to control 15 percent of the auto insurance market in the next 5 years. The group's products will be distributed through Banca Transilvania and OTP Bank, with which it inked exclusivity contracts and through BRD SocGen and CEC Bank.

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