Sales of  Third party Liability (TPL)  electronic policies grow  rapidly in Armenia

ArmInfo. In Armenia, sales of TPL electronic policies are growing rapidly, the share of which in the total number of TPL agreements by June 2020 increased to 13% from 4% a year earlier. According to the data of the Auto Insurers Bureau of  Armenia, according to the results of January-May 2020, the number of  TPL-agreements concluded in the online mode reached 45504, having  increased 3 times in annual terms.

At the same time, the total number of concluded TPL-contracts  decreased in annual terms (January-May 2020 to January-May 2019) by  12.9%, amounting to 360,283. The volume of insurance premiums  collected on them amounted to 7.6 billion drams, with an annual  decline of 8, 7%.  The average insurance premium per TPL-contract  increased by 4.8% on an annualized basis to 21,206 drams. According  to analysts at ArmInfo, the main factor behind such a high activity  of concluding TPL agreements online is the discount applied, but in  the context of the coronavirus pandemic, another reason was added -  the transfer of employees to remote work during the state of  emergency from March 16 to July 13.

Applications for insurance compensation were submitted on the results  of January-May 2020 28 110, which is 11% less than the same period in  2019. And the volume of payments on them amounted to 6.1 billion  drams, with an annual decline of 2.6%. Moreover, 11,511 applications  turned out to be in cases of simplified registration of road  accidents (according to Europrotocol) with an annual decline of  22.8%, for which the volume of compensations paid amounted to 812  million drams (annual decline of 27.4%), and the average size of one  payment was 70 540 drams (annual decline of 6%).

The TPL loss ratio for January-May 2020 was 58%, compared to 76% in  the same period of 2019.  According to the results of January-May  2020, there are 541 351 vehicles with a valid TPL-agreement in  Armenia. Their number in annual terms increased by only 1.1% or by  5,824 units. 174,581 vehicles were insured in Rosgosstrakh Armenia  Insurance Company, 105,632 units in Nairi Insurance, 85422 units in  INGO Armenia, 66431 units in RESO, 61917 units in Force Insurance,  47368 units in Armenia-Insurance.  It should be noted that since  March 16, as part of measures to prevent the spread of the  coronavirus pandemic, a State of Emergency (PE) has been introduced,  which will last until July 13 inclusive. In connection with this, a  temporary ban was imposed on many types of activities in the first  month of emergency (including restaurants, cafes, bars, casinos,  hotels, canteens, retail facilities and industries not related to  food and medical products). As part of the ban, public transport  (including the metro) was suspended in the republic and the movement  of other vehicles (except for taxis) was restricted, and  international aviation, rail and bus services were limited. The ban  was partially lifted in the second half of April, then from May 4 the  list of permitted types of economic activities was further expanded  to ensure the vital functions of the economy, and from May 18 the ban  was lifted almost completely. From the same day, public transport  (including the metro) and many public catering facilities and  services began to operate, but so far the activities of international  air, rail, and bus services have been limited.  According to the  Bureau of Auto Insurers, in January-May 2019, the number of online  TPL-contracts increased by 3.6 times year-on-year to 15,151 (or 4% in  total, against 1.4% a year earlier). At the same time, the total  number of concluded TPL-agreements increased by 33.6% over the year,  amounting to 413 604, and the volume of insurance premiums collected  on them increased by 26.2% to AMD 8.4 billion. The average size of  insurance premiums per TPL-contract decreased by 5.5% over the year -  to 20226 drams.  Applications for insurance compensation were  submitted for January-May 2019 31595 (an increase of 21.7% yoy), and  the volume of payments on them amounted to 6.2 billion drams (an  increase of 12.8% yoy). Moreover, 14917 applications turned out to be  in cases of simplified registration of road accidents (according to  the Euro protocol), for which compensations in the amount of 1.1  billion drams were paid, and the average size of one payment amounted  to 75012 drams. The TPL loss ratio for January-May 2019 was 76%,  against 69% a year earlier. According to the results of January-May  2019, there were 535527 vehicles with a valid TPL agreement in  Armenia (annual growth of 9.4% or 46181 units).  It should be noted  that in Armenia the system of registration of insured events by  Euro-protocol in the TPL market was introduced since March 2016,  initially with a damage threshold of up to 50 thousand drams,  subsequently in September of the same year increased to 100 thousand  drams. And in 2017, work began on the transition of TPL processes to  a single-window system and a single platform for the insurance market  under the project "Armenian Single Window for Automative - ASWA",  under an agreement concluded in 2014 with the French Bureau Veritas  Inspection Valuation Assessment and Control). And from that moment,  such features began to be phased in: conclusion of insurance policies  on TPL through a single- window platform (October 2017); On-Line  sales of policies (November 2017); purchase of policies through  payment terminals with cash-in function (December 2017). And in  February 2020, the next automation of the TPL process followed -  registration of insurance claims on the Euro protocol through the  ASWA mobile application.