Aurica DOINA, Vlad STIRBU, National Commission of the Financial Market (NCFM), Republic of Moldova
With the beginning of the financial crisis, as in other economic-financial sectors, the growth of the insurance market has slowed down. Moreover, if we look at the figures of the first six months of 2010 turned into euros, we basically notice a stagnation of the profile market compared to corresponding periods in 2008 and 2009, due to exchange rate depreciation. This "amortisation" of a more drastic decline of the market was made possible primarily through a pro-European reform of the supervisory authority.
XPRIMM: How does, at this point, the insurance market in the Republic of Moldova present itself?
Vladimir STIRBU: The insurance market in Moldova, like those in the region, knows a growth, but not a very fast one; in addition, the impact of the crisis is obviously felt here, too. However, according to preliminary data for the first nine months of 2010, compared to the same period in 2009, we see an 8% increase in gross written premiums volume. This is not necessarily favorable, as growth in the first quarter reached 15%, and currently we expect, in the last quarter of the year, to recover losses from the third quarter.
XPRIMM: Can we say that Moldova has not suffered so much due to the crisis compared to other countries?
Vladimir STIRBU: We have not suffered in terms of the emergence of negative figures, but the effects are felt, as we initially expected a higher growth in terms of quality. The crisis manifested itself in the form of a slowdown, which for us is still a negative thing.
XPRIMM: What did the National Commission of the Financial Market do to improve the legal framework of insurance?
Aurica DOINA: The financial market reform policy includes measures such as harmonization of legal framework with EU directives, the transition to a transparent, efficient and reliable market and, no less importantly, to restore public confidence in insurance products and, in general, in the non-banking financial products.
In the context of regulations and laws, I must mention that we already have results that were reflected on the local profile market. Here we can talk about the new requirements and limitations in terms of share capital, we can talk about new institutions - such as insurance brokers. Another aspect would be that we are expecting the results of the regulations related to the creation of the legal framework regarding the Street Victims Protection Fund, the compensation fund.
Other measures that will be implemented will reffer to tougher rules for the financial safety of insurance companies. I would underline here that all we have obtained until now was based on values such as commitment and support of colleagues in the market and of our development partners. The context of today must also be mentioned, which I think is a success, because it brought together at the dialogue table both colleagues in the market, as well as leading international experts, who come with their own points of view from their practical experience.
Vladimir STIRBU: Legislation and regulations in the insurance field are now among the main concerns of NCFM. In this chapter we have a slight "delay", but we are now catching up with rapid steps, with support from development partners of the Commission, especially with World Bank support. Through the project financed by this partner, we have now 13 regulations in the final stage. The purpose of these regulations is to align to the EU legislative framework. I hope to succeed in a short time, preferably by mid next year, to finalize all the projects started. The main elements to be introduced until the end of this year are the rules of prudence, extremely necessary, related to solvency and technical provisions, the manner of their calculation. We are reorienting the market towards new assets, to cover technical reserves, and towards solvency, which will allow to maintain the insurer's financial stability.
XPRIMM: How open do you consider the Moldavian insurance market is to foreign investments?
Aurica DOINA: In the Republic of Moldova, we have a favorable, non-discriminatory legal framework and there are plenty of tax instruments that could attract investors' attention. The market is open to foreign investors initiatives and we are expecting them, as a result of the ongoing reforms.
XPRIMM: What do you think is the biggest problem for the insurance market of Moldova and what does the Commission do in this respect?
Aurica DOINA: I think the most striking problem (actually, not so much a problem, as a deterrent factor) is the lack of trust of the population in insurance instruments. They are seen as an extra expense. It is necessary to inform the population in order for the advantages of insurance protection systems to be known. Obviously, the profile industry has the main role, that of solving any problem that citizens could have.
As for regulations, there are no problems, meaning that the insurance industry can face the challenges. I realize that they are complex, and from the experience of other countries we know that new challenges will continue to appear, but we, along with colleagues from the market and our development partners, will try to deal with them.
Vladimir STIRBU: There are situations that are not finalized - including the already mentioned legal framework. Also, I believe that investments in insurance, including new technologies, remain a problem for us. But we hope that, over time, and also with the help of the event organized by Media XPRIMM, we will succeed in our attempt to promote insurance market in Moldova, so that we are known and recognized abroad, and investments will come soon. I think this will ensure a competitive environment and a legal framework to match it.
| Published on 04.11.2010