Thursday, April 17 2014 17:31
Sil Insurance: Motor own damage insurance should become a more popular product
ArmInfo. Motor own damage insurance should become a bulk product, Hayk Baghramyan, CEO at Sil Insurance, has told ArmInfo's correspondent. He says that the introduction of the motor third party liability insurance in the country has not considerably increased the voluntary motor insurance despite the expectations. Nevertheless, the insurer points out that the given segment has a big potential for growth. According to Baghramyan, for the moment only 5% of Armenia's car owners have contracts on motor own damage insurance, whereas nearly 60% of the drivers can afford that insurance.
When commenting on the decline in the growth rates of insurance premiums in the segment of motor own damage insurance, Baghramyan stresses that the loss ratio of the given product has considerably increased over the past few years. He specifies some factors that can improve the situation. "First of all, it is necessary to toughen the insurance payout rules and to punish the fraudsters more actively. The bonus- malus system introduced in 2013 will also have a tangible effect on the situation", he says. He is sure that sooner or later the motor own damage insurance will become more popular with the car owners. Baghramyan also points out that over the past year the motor own damage insurance certificate prices grew by nearly 20%, and "these tariffs meet the current market conditions".
By ArmInfo's Ranking, in 2013, 7 insurance companies of Armenia collected 2.1 bln AMD in the segment of motor own damage insurance (up 9% versus 2012), with Sil Insurance's share being 15% or 322 mln AMD (up 47.2% versus 2012). The payouts in the given segment amounted to 1.4 bln AMD in 2013 (up 7.6% versus 2012).