RCA mandatory motor vehicle liability insurance capped by gov't at level decided by Supervisory body

The government endorsed on Wednesday through a Government Emergency Ordinance (GEO) the legal framework to resolve the issues signaled out on the RCA mandatory motor vehicle liability insurance market. 

According to a government release sent to AGERPRES, the GEO allows the Financial Supervisory Authority (ASF) to set a six-month RCA reference price applied both to individuals and companies. 

"This GEO is adopted considering the exceptional circumstances that have irrupted into a major imbalance between offer and demand, namely the obvious failure of the motor vehicle liability insurance market in Romania. So, the Romanian Government together with the Competition Council have found it necessary to establish a control mechanism of the mandatory motor vehicle liability insurance market in Romania, manifested in a first stage through the ASF setting of rates by capping premiums related to the RCA," says the release. 

In his turn, Prime Minister Dacian Ciolos says that by this GEO the government wishes to ensure 'the clearly defined legal framework for this issue to be resolved by the ASF which has this responsibility.' 

The release also reads that the GEO takes into account the European relevant regulations, the experience of other Member States regarding this kind of insurance's regulation, as well as the propositions lodged by the professional, employers' associations of the car insurers and transporters. AGERPRES