The AutoCar group of companies, consisting of three companies that manage car service units, has notified the Financial Supervisory Authority (ASF) about requesting in court the bankruptcy of City Insurance, the largest Romanian insurance company, according to a press release of the creditor quoted by Bursa.
The company claims that City Insurance has debts of around RON 1.1 million (EUR 230,000) overdue for more than 120 days and the interest plus penalties bring the total debt up to RON 3 mln (EUR 630,000).
Accordingly, the three companies in AutoCar group, namely Autocar, Autocar and Trucks and Standocolor have requested the bankruptcy of City Insurance both at the Financial Supervisory Authority (ASF) and in court, the source said. ASF in a response to AutoCar's request stated that, by the law, it is entitled to monitor (only) the capital requirements of the insurance firms and in this regard City Insurance meets at this moment the required solvency ratios.
AutoCar warned, however, that City Insurance features the same problems faced by former insurers Astra and Carpatica Asig before their bankruptcy: high exposure to the risky segment of third party car insurance (RCA), high share of problems reported by customers, long delays in paying damage claims.
City Insurance currently holds over 45% of the RCA market, and Astra and Carpatica did not exceed 33% of the RCA market share at the time of bankruptcy.