Insurance Coverage Lags behind Losses
06.03.2014According to estimates of the National Recovery Service recovery agency (NRS), the debts of causers of traffic accidents to insurers in 2013 increased by 26% and reached 22.1 billion rubles.
This amount was formed of subrogation and recourse claims. Under subrogation, the insurers are entitled to collect funds from causers of traffic accidents in favor of their victims, subject to such funds exceeding the limits of the compulsory third party car insurance policy (it happens when the victim had a comprehensive and collision car insurance). Recourse claims emerge, for instance, because of deliberate harm to health of the victim of the traffic accident when the causer was in a state of intoxication.
Sergey Shpeter, Senior VP at NRS, explains the growth of claims with record-breaking car sales in 2012, bigger number of traffic accidents (increase by 0.2% according to the State Traffic Safety Inspectorate), as well as the cost of repairs and maintenance. According to the estimates of analysts at NRS, the recovery agencies manage to collect 20–30% from the transferred portfolio. Only 5 billion rubles worth of claims were transferred to recovery agencies, the insurers try to collect the remaining debt themselves or using their organizations, he adds.
According to Sergey Savosin, CEO of Soglasie, this results in recovering only 2–4% from the amount of claims.
If the insurers had recovered all these claims, they would have received the income of over 10% from all recovery from motor own damage insurance (212 billion rubles in 2013), says Inna Zhavrid from Glavstrakhcontrol. With compulsory third party car insurance policy limit rising to 400,000 rubles for property and 500,000 rubles for life and health, as planned by the government, this load on car owners will decrease dramatically, she adds. Nevertheless, the experts from NRS disagree with her: the agency expects the growth of claims in 2014 up to 27–28 billion rubles, and the volume of recovery business – up to 7–9 billion rubles.