Thursday, October 5 2017 13:09
Karine Melikyan

The market of OSAGO goes into virtual space

The market of OSAGO goes into virtual space

ArmInfo.Automation of all OSAGO processes is actively underway in Armenia. For 7 years since the introduction of compulsory motor insurance to this day, many steps have been taken to improve not only this segment, but also the insurance market as a whole. As a result, for 2011-2016, the premiums on compulsory motor third party liability insurance increased by 22% to 18.2 billion drams, holding the dominant in both the portfolio of fees and payments. The number of vehicles with the contract for compulsory motor third party liability insurance increased for the period from 2012-2016 from 390,266 to 468,171 units, and the loss ratio for OSAGO from 74% decreased to 55.3%. But only in 2016, loss-making increased by 2.3% due to the introduction of the euro-mechanism mechanism since March, and the continuation of growth in 2017 to 61.7% in August was due to the transition from April to a system of direct reimbursements. Taking into account the impact of these changes on OSAGO processes, the loss ratio for this class by the end of 2017 is projected in the range of 65-68%. But the development of the insurance market of the Republic of Armenia is not limited only by the internal changes in the procedures. For more than a year the Green Card Bureau has been discussing the process of Armenia's possible membership in the system of international motor third party liability insurance. Vahan Avetisyan, Executive Director of the Bureau of Motor Insurers of Armenia, spoke in more detail about the situation on the segment of compulsory motor TPL insurance and development prospects in a conversation with ArmInfo correspondent. 

 

What is the situation with payments on the euro-protocol? What is the percentage of penetration of the simplified procedure among the population? Namely, how many insurance cases according to the latest data are registered under this scheme? 

The process of registration of insurance cases on the European protocol, which started from March 2016 in the beginning with the threshold of damage up to 50 thousand drams with the increase of this bar in September of the same year to 100 thousand drams, is already significantly rooted among Armenian drivers, and has outlined a stabilization trend. This is evidenced by specific figures: 45-53% of the total volume of refunds under the simplified procedure (Europrotocol) have been registered in recent months; approximately 2200-2600 insurance cases, against those fixed at the beginning of this year. 30-60% or about 1200-2500 cases. 

Is it planned for the maximum convenience of drivers when registering an accident by introducing a mobile  version of registration of insurance cases for the euro-protocol?

Yes, the mobile version of the registration of insurance cases on the euro-protocol will be introduced during 2018. Currently, this application is at the stage of registration of the technical reference. As a result, drivers with an independent registration of an insurance event will have a choice in which version to fill out a questionnaire - paper or mobile. 

In addition, is it planned to expand the automation of OSAGO processes?

 Works are already in progress to transfer OSAGO processes to a new level of standards and automation - to the single window system and a single platform for the insurance market under the project  of Armenian Single Window for Automative - ASWA. This is carried out within the framework of the agreement concluded in 2014 with the French Bureau Veritas Inspection and Control. Since November 2017, insurance policies for OSAGO will already be concluded under this system, i.е. From now on all insurance companies will provide insurance policies only through a single window platform. At the same time, the possibility of On-Line sales of policies (via the Internet) will be introduced, and in December it will be possible to purchase policies through payment terminals with a cash-in function. Thus, the process of introducing different opportunities for concluding insurance contracts for OSAGO through the Single Window will be completed by the end of 2017..

 

At what stage is the implementation of the standard methodology and automated programs for damage assessment and guilt?

Until mid-2018, we plan to launch an electronic version of registration of insurance cases, a unified registration system with the Road Police according to more modern standards. In the same period it is important to have time to complete the introduction of a standard methodology and automated programs to assess damage and establish guilt.

How do you estimate the work of the direct compensation mechanism after almost 6 months from the date of implementation?

 Implementation since April this year of the mechanism of direct reimbursement turned out to be the root change in the OSAGO system. After almost half a year from now I can state that the process of transition to this system has gone very smoothly without excesses, i.e. There were no complaints from customers, insurance companies or regulators. Perhaps a little disagreement concerned only the technical part of the transition (mutual settlements) to this system, but these issues were quickly resolved. I will say more, from April to this day, disagreements on insurance cases under this system of compensation recorded only about 200, and this is only 0.5-0.7% of the total. And this suggests that the introduction of this compensation mechanism and the Central Bank and the Bureau of Motor Insurers and insurance companies are well prepared. 

How much did it serve the ultimate goal?

I think that it was very useful. Namely, insurance companies have become much more efficient in providing services. And this is starting with the registration of the case and ending with the prompt payment of reimbursements.

 

 Now all possible combinations are used for the rapid implementation of insurance payments. The number of complaints has significantly decreased. The gap in the average size of the insurance payment for OSAGO significantly narrowed from the previous 150-210 thousand drams (before the introduction of direct reimbursements) to the current 178-198 thousand drams (after the introduction of this system), i.е. the approach of insurance companies to the assessment of damage has become more similar. In other words, there is the fact that the direct reimbursement system is a typical model of self-regulation.

Positive consequences: revaluation or underestimation of damage is excluded, the discipline of both the insurance companies themselves and the process of paying reimbursement on their part has increased.

 In fact, the implementation of the April 2017g. the system of direct reimbursements completed the process of logical regulation, and then proceeded to technical and technological support, i.e. to automation by modern standards.

 At this stage, our expectations for the system of direct reimbursements have been fully justified, but we still have to solve a number of problems in the near future. 

 

How has the level of unprofitability in motor third party liability insurance for the last year changed and what is the evidence of this dynamics? 

At the end of August 2017, the loss ratio for OSAGO was 61.7%, compared to 48.8% a year earlier. This is one of the main indicators of the result of the implementation of the system of direct reimbursements, which indicates an increase in the level of compensations paid. This means that insurance companies have become more efficient in servicing their clients, it is more correct to assess damage, and to promptly pay reimbursements. 

 

Is it possible to talk about any visible results on the "bonus-malus" system? What aspects of this system need improvement? 

In December 2016, we switched to the bonus malus system based on the owners of motor vehicles. The introduction of this system revealed and solved a number of shadow problems. Basically, taxi services were in the class of high malus due to a large number of accidents, due to which the final insurance premium for them increased. This created some social tension, and after the introduction of the new bonus malus system, we established a privilege for taxi services by a one-time reduction of 4 malus classes.

 In reality, the final picture of the transition to the bonus-malus system is objective, reasonable and fair, as it reflects both the problems existing in the field of public transport and taxi, as well as real statistics of accidents and inefficiency of management of this process. In fact, for owners of vehicles, an insurance premium is established, which corresponds to their level of risk. In particular, for a category with a high level of risk, a high insurance premium is established, and for low-risk ones, a low insurance premium is established. I think that most of the policyholders took this change positively.

 Regarding the issue of improving this system, during the discussions with the Bureau of Motor Insurers, two main proposals were submitted. The first concerns accounting for the calculation of malus, in addition to the number of accidents, as well as a new factor - the amount of damage caused. The second concerns raising the extreme threshold of malus for the most high-risk insurers. Both proposed changes are appropriate, but in my opinion they are premature. They are still at the stage of research and discussion, and in the near future are unlikely to be introduced. In addition, in order not to face more serious problems, it is necessary to study the foreign experience more deeply. 

 

What about the process of Armenia's joining the Green Card  system and the organization of all the necessary legislative changes? What tasks were put before Armenia on the agenda of the nearest decision? 

For more than a year, this process has been started and relevant discussions are underway to include Armenia in the Green Card system. The Bureau of Motor Insurers of Armenia and the Green Card Bureau have recently intensified discussions on the possible membership of Armenia in the system of international motor third party liability insurance.

 In June 2017g. we visited representatives of the Central Bank of Armenia in Brussels at the headquarters of the Green Card Bureau, where they examined the mechanisms of this system and discussed the issues and main problems of our participation with the leadership. Then, at our invitation, the president and representatives of the Green Card Bureau visited Armenia from 4 to 8 September. During the visit, a number of meetings were organized with the Central Bank of Armenia, the Bureau of Motor Insurers of Armenia and the RA Road Police to discuss some of the issues on the agenda. An extended seminar-discussion was also organized with the participation of representatives of the Central Bank, the Ministry of Finance, the Road Police, insurance companies and the Bureau of Motor Insurers. In the seminar, the Green Card Bureau delegation presented the main principles of the Green Card system operation, as well as the main issues and problems that need to be solved for Armenia's entry into the system of international motor third party liability insurance.

 The main problems, in principle, delaying the membership process, relate to the Green Card Bureau's demand for a real restriction of sales of Green Card policies for cars registered in the NKR, as well as the need to properly inform owners and / or drivers of foreign cars that they enter the territory of the NKR , where the Green Card policies do not cover insurance events / risks.

 The remaining tasks and recommendations submitted by the Green Card Bureau are legal and financial. These recommendations are based on the requirement to introduce a number of legislative and sub-legislative changes, which has already been undertaken on our part. We also need, together with insurance companies, to discuss in more detail and select the appropriate financial instruments within the rules established by the Green Card Bureau.

 

An important task is also the requirement of the Green Card Bureau for participating countries to be compulsorily involved in the International Convention on Road Traffic (ICDD) and the International Convention on Road Signs (ICDL). Moreover, Armenia is already a party to the ICRM, and the process of membership in the MKDZ started several months ago. In particular, the Ministry of Foreign Affairs, the Ministry of Justice and the Road Police are already working towards the solution of this problem.

 I think that as a result of all these joint meetings and seminars, the Green Card Bureau has a general preliminary idea of ​​the necessary further steps and solutions that will contribute to the inclusion of Armenia in the Green Card system. As I have already presented above, steps have been taken in practically all directions.

POST A COMMENT
Input digits     


News
Breeding poultry farm Breeding poultry farm "Arzni" does not recognize the decision of the  regulator and will appeal against it
Ardshinbank is the winner of Eikon Award 2018 by Thomson ReutersArdshinbank is the winner of Eikon Award 2018 by Thomson Reuters
Tatul Manaseryan: The modest figures included in the country`s budget  for 2019 may be exceededTatul Manaseryan: The modest figures included in the country`s budget  for 2019 may be exceeded
The state initiative on amnesty of bad loans fines did not prevent  increase of overdue loans The state initiative on amnesty of bad loans fines did not prevent  increase of overdue loans 
Armenian government is negotiating to attract a new operator of  Teghut field development projectArmenian government is negotiating to attract a new operator of  Teghut field development project
In a month world`s largest semi-closed greenhouse will be  commissioned in Armenia In a month world`s largest semi-closed greenhouse will be  commissioned in Armenia 
T.Avinyan: The Government is open for cooperation and encourages  active dialogue and interaction in all areas T.Avinyan: The Government is open for cooperation and encourages  active dialogue and interaction in all areas 
EBRD is interested in implementing new projects in the field of  renewable energy in ArmeniaEBRD is interested in implementing new projects in the field of  renewable energy in Armenia
Ameriabank is recognized by Thomson Reuters as the winner in the  category Ameriabank is recognized by Thomson Reuters as the winner in the  category "The Most Active User of the FXT Platform"
Energy Week 2018 Investment Forum to be held in YerevanEnergy Week 2018 Investment Forum to be held in Yerevan
Central Bank of Armenia preferred to maintain the refinancing rate at  6%Central Bank of Armenia preferred to maintain the refinancing rate at  6%
Pashinyan: A number of foreign investors show interest in building  copper smelting plants in Armenia Pashinyan: A number of foreign investors show interest in building  copper smelting plants in Armenia 
SRC Deputy Head: Armenian tax authorities will take measures to  increase non-cash turnover in 2019SRC Deputy Head: Armenian tax authorities will take measures to  increase non-cash turnover in 2019
Nikol Pashinyan: The North-South Road must be built according to the  highest quality standardsNikol Pashinyan: The North-South Road must be built according to the  highest quality standards
Iranian``Ariana Tunnel Dam Co.`` company presented preparatory work  for construction program of Bagratashen bridgeIranian``Ariana Tunnel Dam Co.`` company presented preparatory work  for construction program of Bagratashen bridge
From January 1, 2020, Armenia plans to introduce a system of total  declaration of incomes of citizensFrom January 1, 2020, Armenia plans to introduce a system of total  declaration of incomes of citizens
Beeline launched a mass texting service for corporate clientsBeeline launched a mass texting service for corporate clients
Ministry of Finance: Armenia should not hope for the possibility of  writing off part of the state debt by creditorsMinistry of Finance: Armenia should not hope for the possibility of  writing off part of the state debt by creditors
Agreement on construction of a new unit with combined gas cycle  signed in YerevanAgreement on construction of a new unit with combined gas cycle  signed in Yerevan
Armenia and Georgia discussed Armenia and Georgia discussed "Friendship" border bridge construction  project 
Armswissbank was granted market maker status on the first INECOBANK  dollar bonds- late information Armswissbank was granted market maker status on the first INECOBANK  dollar bonds- late information 
Armenia will create its own database of grape varietiesArmenia will create its own database of grape varieties
EDB: In the short term, we should expect a further slowdown in the  growth of the Armenian economyEDB: In the short term, we should expect a further slowdown in the  growth of the Armenian economy
VWFA study: Several tens of autochthonous grape varieties revealed in  ArmeniaVWFA study: Several tens of autochthonous grape varieties revealed in  Armenia
Minister: Artsakh`s budget in 2019 may be surplusMinister: Artsakh`s budget in 2019 may be surplus
New strategy of Armenia`s mining industry is directed against  New strategy of Armenia`s mining industry is directed against  "offshore hide-and-seak" and aimed at revealing the real owners of  companies
PRC Ambassador: Chinese company Sinohydro Corporation is ready to  take part in the construction of PRC Ambassador: Chinese company Sinohydro Corporation is ready to  take part in the construction of "North-South" in the next phase -  Tranche-4
Relevant committee of NA recommended the draft budget for 2019 for  adoptionRelevant committee of NA recommended the draft budget for 2019 for  adoption
Construction of a complex for IT companies is planned in YerevanConstruction of a complex for IT companies is planned in Yerevan
Converse Bank initiated the first SME Banking Club seminar in ArmeniaConverse Bank initiated the first SME Banking Club seminar in Armenia


Exchange rates
15.11.2018
RUB7.310.10
USD487.27-0.69
EUR549.69-0.24
GBP622.97-9.72
CAD368.45-0.10
JPY42.980.14
CNY70.22-0.09
CHF483.930.66

Experts
Association of Organic Agriculture is being created in ArmeniaAssociation of Organic Agriculture is being created in Armenia
Pailak Tadevosyan: Governments change in Armenia, but taxation  approaches do not changePailak Tadevosyan: Governments change in Armenia, but taxation  approaches do not change
Rouben Indjikian: Everyone should follow the established unified and fair rules of the gameRouben Indjikian: Everyone should follow the established unified and fair rules of the game
Mher Arakelyan:  Armenia`s payment business has great prospectsMher Arakelyan:  Armenia`s payment business has great prospects
Rating-Agentur Expert RA GmbH and AmRating issued an industry report  on Armenia`s banking systemRating-Agentur Expert RA GmbH and AmRating issued an industry report on Armenia`s banking system
Igor Nazaruk: Each planted sprout has the right to a successful prospect if it is cherished and taken care ofIgor Nazaruk: Each planted sprout has the right to a successful prospect if it is cherished and taken care of
Ara Khzmalyan: Armenia is comfortable to Russian touristAra Khzmalyan: Armenia is comfortable to Russian tourist
The Armenian delegation to the US followed the advice of President TrumpThe Armenian delegation to the US followed the advice of President Trump
Outflow of population and passivity of the Diaspora pushes property prices downOutflow of population and passivity of the Diaspora pushes property prices down
Finombudsman: Amendments to the Civil Code on the imposition of fines and penalties will reduce the number of outstanding loans and  non-creditworthy consumersFinombudsman: Amendments to the Civil Code on the imposition of fines and penalties will reduce the number of outstanding loans and non-creditworthy consumers
Vahan Shakaryan: If we promote Armenia, the promotion of economic sectors will not be a run with obstacles, but a light run for short distancesVahan Shakaryan: If we promote Armenia, the promotion of economic sectors will not be a run with obstacles, but a light run for short distances
Gagik Aghajanyan: There is no need to look for alternatives - it is necessary to work and develop actual   directionsGagik Aghajanyan: There is no need to look for alternatives - it is necessary to work and develop actual   directions
Vitaly Nesis: Armenia is very promising from the geological point of viewVitaly Nesis: Armenia is very promising from the geological point of view
The market of OSAGO goes into virtual spaceThe market of OSAGO goes into virtual space
Ishkhan Mkhitaryan: ArCa and Mir complete the technological part of the project of interaction, business for banksIshkhan Mkhitaryan: ArCa and Mir complete the technological part of the project of interaction, business for banks
The second stage of implementation of the program for prolonging the lifetime of the power unit N2 of the Armenian NPP beginsThe second stage of implementation of the program for prolonging the lifetime of the power unit N2 of the Armenian NPP begins
Successful business is forging for years - to the jubilee of IC Successful business is forging for years - to the jubilee of IC "INGO Armenia"
Armen Shahnazaryan: The double increase in the insurance portfolio of EIAA ICJSC by the end of 2018 is quite feasibleArmen Shahnazaryan: The double increase in the insurance portfolio of EIAA ICJSC by the end of 2018 is quite feasible
Expert: Real estate market of Armenia started demonstrating weak  signs of recovery in I half-yearExpert: Real estate market of Armenia started demonstrating weak signs of recovery in I half-year
Amulsar: Ecology and РeopleAmulsar: Ecology and Рeople

Search by date

Government Bonds

 

ISIN AMGB1029A250
Auction ID AMGB1029A250A
Date 12.05.2017
Issue date 29.10.2015
Issue volume (AMD) 50 000 000 000
Maturity date 29.10.2025
Coupon year yield 11.00%
Auction volume (AMD) 1000 000 000 - 2.000 000 000
Auction date 12.05.2017
DLS
Total amount (AMD) 1 000 000 000
Amount of the total bids (AMD) 787 200 000
Amount of the total accepted bids (AMD) 787 200 000
Cut of yield (%) 10,6447
Weighted avrage yield (%) 10,6447
Auction max  yield (%) 10,6447
Auction min  yield (%) 10,6447
Number of participants 5
ArmEx

 

СПРОС (Покупка)

USD

Средневзв. Цена

482,00

ПРЕДЛОЖЕНИЕ (Продажа)

  USD

Средневзв. Цена

-

СДЕЛКИ

USD

Цена откр.

482,00

Цена закр.

482,00

Мин. Цена

482,00

Макс. Цена

482,00

Ср/взв. Цена

482,00

-0.16

Кол-во сделок

1

Объем (инвал.)

200 000

0бъем (драм)

96 400 000

Commented
Veolia Jur: Regulatory charges are false and unfoundedVeolia Jur: Regulatory charges are false and unfounded
Armenian Prime Minister: We are gaining momentum for economic takeoffArmenian Prime Minister: We are gaining momentum for economic takeoff
By the end of 2018, By the end of 2018, "Galburdjian Group" will launch the production of  sesame oil in Armenia
Expert: Armenia has a problem with effective use of water resources,  rather than small hydropower stationsExpert: Armenia has a problem with effective use of water resources,  rather than small hydropower stations
Investment forum Investment forum "Energy Week 2018" to be held in Armenia
Expert: It is necessary to start implementing the program for the  construction of a new nuclear unitExpert: It is necessary to start implementing the program for the  construction of a new nuclear unit
The updated feasibility study of construction project of electricity transmission line Armenia- Georgia will be ready by the end of the year - the Ministry of EnergyThe updated feasibility study of construction project of electricity transmission line Armenia- Georgia will be ready by the end of the year - the Ministry of Energy
Eurasian Development Bank wishes to expand its activities in ArmeniaEurasian Development Bank wishes to expand its activities in Armenia
$ 100 million to be invested in repatriation project Build Armenia$ 100 million to be invested in repatriation project Build Armenia
FRV: Armenia`s growing desire to increase renewable energy sources is  a decisive factorFRV: Armenia`s growing desire to increase renewable energy sources is a decisive factor
Suren Papikyan: It`s safe now to do business in Armenia, assures  Armenian MinisterSuren Papikyan: It`s safe now to do business in Armenia, assures  Armenian Minister
Armenian state debt started reducing up to $6.7 bln to June 1 2018Armenian state debt started reducing up to $6.7 bln to June 1 2018
Minister: Implementation of program on liberalization of the electric  power complex of Armenia will be completed within the next two yearsMinister: Implementation of program on liberalization of the electric  power complex of Armenia will be completed within the next two years
Nikol Pashinyan: In a number of cases after paying fines and  penalties the borrowers will be allowed to take new loan Nikol Pashinyan: In a number of cases after paying fines and  penalties the borrowers will be allowed to take new loan 
German bank KFW urges Armenia to build power line in the direction to  GeorgiaGerman bank KFW urges Armenia to build power line in the direction to  Georgia
Anna Chobanyan-one of most likely candidates for new Head of General  Department of Civil Aviation Anna Chobanyan-one of most likely candidates for new Head of General  Department of Civil Aviation 
IFAD confirms its readiness to develop and implement new joint programs with Armenia`s Agriculture MinistryIFAD confirms its readiness to develop and implement new joint programs with Armenia`s Agriculture Ministry
Rosselkhoznadzor asks not politicize the issue of deliveries of tomatoes from Armenia to RussiaRosselkhoznadzor asks not politicize the issue of deliveries of tomatoes from Armenia to Russia
Armenian nuclear power station has a resource for work for another 30  yearsArmenian nuclear power station has a resource for work for another 30 years
Premier: Construction of a new nuclear power plant in Armenia is one of the priorities of the new government of the countryPremier: Construction of a new nuclear power plant in Armenia is one of the priorities of the new government of the country
In Armenia, an online service has been activated that allows  calculating the cost of customs clearance of a carIn Armenia, an online service has been activated that allows calculating the cost of customs clearance of a car
Gyumri programmers won on hekaton Gyumri programmers won on hekaton "Innovative ideas for tourism development"
Armenian Lori opens a large international ski resortArmenian Lori opens a large international ski resort
A number of light and alcohol industry enterprises of Armenia will be  provided with state supportA number of light and alcohol industry enterprises of Armenia will be provided with state support
Expert: The attitude of Armenian public to the nuclear power industry is demonstrated not by the promiseExpert: The attitude of Armenian public to the nuclear power industry is demonstrated not by the promise
Expert: The biggest gap in procurement legislation is the lack of an institution for accountability for its violationExpert: The biggest gap in procurement legislation is the lack of an institution for accountability for its violation
Maxim Sokolov: Russian Federation remains the main trade partner of  ArmeniaMaxim Sokolov: Russian Federation remains the main trade partner of Armenia