OSAGO reform: what will change in auto insurance in 2019

2024 Author: Malcolm Clapton | [email protected]. Last modified: 2023-12-17 03:44

What shortcomings did the old OSAGO system have and how they are going to be corrected - they have collected in one material all the information about the upcoming changes.

OSAGO - compulsory motor third party liability insurance. Drivers know that it is impossible to drive on the road without OSAGO. The meaning of this policy is that if an accident occurs through your fault, you will not have to pay for the damage to the victim: it will be covered by the insurance company from which you bought the policy.

How the cost of the policy is calculated according to the old rules

Now insurance companies set the base tariff (TB) for compulsory motor third party liability insurance for all residents of one city. Then different factors influence the policy price. The formula for calculating OSAGO at the moment looks like this.

OSAGO = TB × KBM × CT × KM × KVS × KO × KS × KN

• KBM - bonus-malus coefficient. The KBM of the novice driver is equal to one. If the driver has had accidents in the past, the coefficient rises, and vice versa: bonuses are awarded for accurate driving. If the driver does not issue an OSAGO policy for a year, the coefficient returns to one again.
• CT - territory coefficient … Installed for each locality. For example, in Moscow, the CT is 2, in the Moscow region - 1, 7, and in the neighboring Kaluga region - already 0, 9.
• KM is the power factor. The more horsepower, the higher the cost of insurance. Now, with a car power of 120 horsepower, the tariff increases by 40%, more than 150 horsepower - by 60%.
• KVS - coefficient of age and experience. The KVS for beginners under 22 or with less than three years of driving experience is 1, 8, and for more experienced drivers - one.
• KO - coefficient of restrictions. If an unlimited number of drivers are driving the car, the insurance will cost more.
• КС - coefficient of the period of use. With annual insurance, the coefficient is equal to one.
• КН - coefficient of violations. Takes into account gross violations of the law. For example, driving while drunk or escaping from the scene of an accident.

What are the disadvantages of this system

OSAGO is compulsory insurance, and therefore it is very common. In 2017, it had OSAGO. Actions of the Bank of Russia to stabilize the situation 17.4% of all insurance premiums. At the same time, more than 80% of complaints against insurers related specifically to OSAGO.

Driver assessment is too general

City drivers differ not only in the experience and power of the car. Someone works day and night by car, while others go once a week for groceries. In addition, the place of registration only indirectly affects the risk of an accident, especially since the car can be registered in any region. Now drivers with the same traffic and accidents pay different amounts for the policy just because they formally belong to different areas. This does not take into account either the real traffic density or the condition of the roads.

Accident history is easily reset

It is enough for 12 months not to be included in the CMTPL policy - for example, to travel on insurance without restrictions - and MSC will again return to unity. In this case, the bonuses of neat drivers burn out and the history of emergency drivers is canceled.

Power factor is outdated

Cars with 100 horsepower used to be considered almost race cars, and their insurance was more expensive. Now this is the standard capacity of cars, but there is still an increased tariff for the owners. At the same time, a clear connection between the power of the car and the accident rate was not identified.

What is the essence of the reform

They want to make the compulsory insurance system more fair: to calculate the cost of OSAGO not by average figures, but individually for each driver. For this, the Central Bank and the Ministry of Finance have prepared a set of measures that will be carried out in stages.

As a result of the reforms, outdated or unfair ratios will be canceled. Instead, insurance companies will be able to enter their own factors to evaluate drivers. For example, take into account marital status or the use of telematics devices that track driving frequency and driving style.

To increase the responsibility of insurers for the sale of OSAGO policies, the Central Bank of the Russian Federation plans to maintain a state register of reliable insurance agents. On the website of the Central Bank, drivers will be able to see which agents can be trusted. It will be possible to find out the cost of the policy from different insurers through individual calculators on the companies' websites.

What exactly will change in OSAGO

Accounting for past accidents and bonuses for trouble-free operation will be conducted more fairly and understandably, power factors and territories will no longer be taken into account, the driver's experience and insurance history will be considered in more detail, and the policy itself can be made for one day or for 2-3 years.

Calculation of the bonus-malus ratio (BMR)

The coefficient will be assigned to the driver on April 1 of each year. No matter how many OSAGO contracts the car owner concludes, the coefficient will not change. The next April 1, the presence or absence of payments for accidents for the previous year will be checked and a new coefficient will be assigned.

Abolition of Territory Coefficient (CT)

Each driver will be offered their own base rate. Insurance companies will be able to take into account the real situation in the city and the driving habits of each person. At the same time, if the driver does not agree with the assessment of one company, he will be able to turn to another - such competition will force insurance agents to provide fair and favorable conditions.

Cancellation of power factor (KM)

In addition to the fact that too many cars fall under the increased tariff, the Ministry of Finance informs the Ministry of Finance proposes to change the accounting of regional coefficients in OSAGO, that according to the statistics of the Ministry of Internal Affairs, there is no connection between the power of the car and the number of accidents, therefore, CM will not be taken into account.

Detailed classification of drivers by experience

In the new system, driver experience will become a more important factor. For example, drivers with more than 14 years of driving experience will receive the lowest rate and pay less for insurance. Instead of the current four categories, 58 will be entered.

The ability to make a contract for any period

Car owners will be able to conclude an insurance contract for any necessary time - even for one day. This will be a way out in situations when you need to drive right now, if the car is used for only a few months a year, or when the old policy expires before the sale.

When the changes take effect

The bill is under development, and the reform itself will take place in two stages.

First step. The Bank of Russia will simplify and make the MSC assignment system more understandable and transparent, introduce a more detailed gradation of drivers by age and experience, and expand the tariff corridor by 20 percent down and up. The Bank of Russia directive has already been approved and sent for registration to the Ministry of Justice; it will enter into force 10 days after its official publication.

Second phase. A bill will be passed that will allow insurance companies to set individual base rates. The Bank of Russia will continue to set the minimum and maximum values of the tariff corridor and control the profits of insurers.

Who benefits from this reform

Under the new tariffication, insurance companies will be able to lower the price of the policy for experienced and accurate drivers and raise it for emergency drivers. This means that those who follow the rules will not overpay for those who like to play around.

The head of the Russian Union of Auto Insurers Igor Yurgens says to RSA: the CMTPL reform will raise the price for aggressive drivers and reduce for the neat ones that 80% of Russian drivers drive carefully, so the policy will only become more expensive for those 20% who drive aggressively and often break the rules.