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The year that is closing has brought a high increase in road accident damages paid by insurance companies.
For the 11-month period 2021, insurance companies pay about 2.5 billion ALL, or almost 21 million euros in damages from compulsory motor insurance for internal liability to third parties (MTPL).
Compared to the same period last year, damages have increased by 37%. Even, the damages have increased significantly compared to 2019, by 22% more.
This year’s growth has put the MTPL product at the top of the claims rankings, with almost 46% of the total. Last year, the weight of this product in the damage structure suffered a significant decrease, caused by the reduction of damages due to movement restrictions, but also by the high increase of damages in the class of natural disasters.
Instat data showed that for the 11-month period 2021 the number of road accidents increased by 12% compared to the same period a year ago. The closure and drastic restrictions that were applied last year to limit the spread of the pandemic temporarily reduced the number of accidents, but the return to normalcy led to a significant increase.
The new law “On compulsory insurance in the transport sector”, which entered into force in July 2021, provides for a gradual increase in the liability limit for insurance companies. The increase in the liability limit, accompanied by an increase in claims, is expected to lead to an increase in compulsory insurance tariffs over the next year. At the beginning of next year, the ceiling levels of sales commissions that companies can provide for these insurances will also come into force. From January 1, these commissions can not be higher than 20%.
Placing a ceiling on commissions will narrow the space for price competition between companies. This will make the reductions offered by the official fee or gross written premium smaller and mean that drivers are expected to pay more for TPL insurance.
Overall, insurance companies are paying less damage this year, down 12.7% from 11 months in 2020. This is mainly due to the significant increase in damage caused by the earthquake on last year’s balance sheet. If we compare the 11-month period 2021 with the same period of 2019, before the pandemic, the damages result in an increase of 14.7%.
A pandemic has had the opposite effect on the life insurance market. The increase in deaths has led to an increase in gross claims paid by more than 41%. If we exclude the provision of disasters, most other classes have marked an increase in damages during this year, reflecting the return to normalcy of social and economic activity in the country. In addition to compulsory motor insurance, high increases, with 20% have also marked damages from voluntary insurance CASCO. Even in this case, the most important factor is the increase in the number of accidents./ Monitor
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