Bulgaria’s Eurohold seeks amicable agreement with Romanian market regulator

Bulgarian group Eurohold, the owner of insurer Euroins with its core activity in Romania, promises to continue smooth operations, including meeting all its obligations related to the motor insurance contracts (some EUR 250 mln) if the Romanian market authority ASF revokes its March 17 decision and returns the operating license to Euroins (Romania).

ASF revoked the license of Euroins Romania, which it found to show signs of insolvency. The institution appointed an independent manager for the company and announced further steps towards the bankruptcy of the insurer.

ASF refused to endorse a reinsurance contract signed by Euroins Romania with EIG Re – the reinsurance arm of Euroins group – which the Bulgarian group claims that would restore the capital requirements of the Romanian subsidiary. Under the contract, Eurohold claims, EIG Re covers 87% of the Euroins Romania liabilities, and Allianz covers another 10% – with only 3% of liabilities left not reinsured.

As a result of the ASF decisions, the Policyholders Guarantee Fund (FGA), appointed by ASF as an independent manager for Euroins Romania, will make all the payments related to the insurance contracts issued by the troubled insurer.

The bankruptcy of Euroins could involve 140,000 damage files and payments worth EUR 250 mln, ASF vice-president Cristian Roşu said on March 21.

(Photo source: Euroins Romania)