Romanian insurance market: solid growth, maturation, and increased confidence in local risk absorption capacity

Bucharest, 25 June 2025 - The Financial Supervisory Authority (ASF) publishes its Report on the evolution of the insurance market in the first quarter of 2025. The data analysed indicate a trend towards market consolidation, with positive results in terms of underwriting volumes, profitability, reserves, and operational efficiency. The robust growth in gross written premiums, together with the decline in the combined ratio and the increasing diversification of the motor third-party liability insurance market, reflect the gradual maturation of the insurance sector in Romania.

In a macroeconomic environment characterized by uncertainty and inflationary pressures, the insurance market continues to evolve steadily and gain the confidence of participants, but this dynamic calls for rigorous management of solvency and liquidity issues to ensure the long-term sustainability of the sector.

The slightly lower solvency indicators recorded in the first three months of 2025 should be understood in the context of more active risk retention by companies in Romania. Companies ceded less to reinsurance, which translates into increased confidence in the domestic market's ability to manage claims. However, this approach implies a greater need for capital to cover the obligations assumed, which is why solvency ratios are slightly down, without raising any alarm bells regarding the stability of the sector. Thus, the solvency capital requirement (SCR) coverage ratio was 159%, and the minimum capital requirement (MCR) coverage ratio was 376%. Both values remain comfortably above the regulatory limits, but are down from the end of the first quarter of 2024, amid faster growth in capital requirements compared to the dynamics of eligible own funds.

Key developments in the insurance market in Q1 2025

• Total gross written premiums: Approximately RON 6 billion (+7% compared to Q1 2024), of which:

• General insurance: +5% (RON 4.7 billion) – excluding gross written premiums of companies with FoS licenses
• Life insurance: +14% (RON 1.3 billion)

• Increased profitability: Total net profit of RON 1.34 billion in 2024 (+43% compared to 2023)
• Decrease in combined ratio: 87.2% in 2024 (vs. 89.36% in 2023), due to more efficient risk management, particularly in key classes A3 – CASCO: -2.6 points and A10 – MTPL: -0.85 points.
• Diversification in the MTPL segment:
• Diversification in the MTPL segment:

• New companies entering the market (FoE/FoS)
• Top 3 insurers hold 55% of the market in Q1 2025 (vs. 60% in Q1 2024)
• Number of MTPL contracts: +8% (1.8 million units annually)

• Motor insurance (classes A3 and A10) remains the main segment of general insurance, accounting for 69% of total premiums written in the GA segment. In Q1 2025, gross premiums written for MTPL insurance increased by 11%, reaching RON 2.38 billion.
• Accelerated growth in the health insurance segment:

• Gross premiums written (including branches): RON 380 million (+13%)
• Contracts in force (only ASF-authorized companies): 255,325 (+10%)

• Technical reserves (Solvency II): RON 22.7 billion (+15%)
• Gross compensation paid: 2.81 billion lei (+13%), with an average MTPL claim of RON 10,228 (+5%)
• Investment portfolio: RON 33.4 billion, dominated by government bonds (64%)

The share of class A10 (MTPL and CMR) in general insurance (49% of total premiums), the high level of concentration in the general insurance segment (five companies hold a 74% share) and the high dependence on distribution through brokers (79% of general insurance) remain issues for analysis, but structural evolution indicate that the sector is adapting positively to the new market conditions.

ASF will continue to closely monitor the solvency, liquidity, and capital structure of companies in the sector to ensure consumer protection and the proper functioning of the market in the medium and long term.

The report on the evolution of the insurance market in the first quarter of 2025 can be consulted HERE.