Supervision of the entire MTPL market may be delegated to a separately created state company if insurers cannot cope with the shortage of policies in a number of regions of Russia. The Central Bank threatened insurers with this at a closed meeting with market participants. It should be noted that currently it is the Central Bank that regulates the auto insurance industry. The president of the All-Russian Union of Insurers told reporters about such radical plans of the department. According to him, if, with the help of the mechanism of increased sales of compulsory motor insurance in five regions (the so-called single agent RSA), insurers do not solve the problem with the availability of compulsory motor vehicle policies, then this segment of insurance will be given to a state-owned company.
“The director of the insurance market department of the Bank of Russia said: either the RSA will somehow solve the problem with compulsory motor liability insurance, or we will move on to plan B,” Yurgens reported Zhuk’s words. — One of the options for Plan B is the creation of a state insurance company. If you can’t handle it yourself, then the same will happen to the National Reinsurance Company.”
If a state-owned company is created, the OSAGO segment will actually become subsidized, Yurgens noted.
Instead of improvement - deficit
Let us remind you that the problem with forms of compulsory motor liability insurance policies in the regions was once again discovered in the spring. According to regional media reports, even in large cities, gigantic queues sometimes formed of those wishing to purchase an auto insurance policy. For example, in Magnitogorsk, Chelyabinsk region, drivers spent days on duty at the offices of insurance companies, compiling lists for several days in advance. In other cities, drivers united and organized transfers to other settlements in the region, where there were no problems with issuing compulsory motor liability insurance.
RSA knew about the problem and tried to solve it. In the five most problematic areas, a mechanism to increase compulsory motor vehicle liability insurance sales began operating on June 1. The head of the RSA clarified that the use of such a mechanism for purchasing a policy will not be an obligation, but an option for motorists and a choice.
“If initially the list of such regions included the Krasnodar Territory, Rostov and Volgograd regions, now it has been decided to add the Chelyabinsk and Murmansk regions to them,” he said about the problem regions.
Yurgens assured that during June both the number of sales points and the number of sellers of compulsory motor liability insurance policies will increase, which will lead to a reduction in tension in these territories.
According to the head of the VSS, problems with the availability of compulsory motor insurance in a number of regions arose due to excessive activity
“The emergence of an additional opportunity to purchase compulsory motor insurance is an interim measure to quickly solve the problem of providing motorists with insurance,” said Yurgens. — A comprehensive solution is a whole block of measures, including proposals to improve legislation, which the union has developed. We believe that when proposals for the priority of in-kind compensation in compulsory motor liability insurance and a number of others are introduced, it will be possible to ensure the availability of compulsory motor liability insurance throughout the Russian Federation without increasing tariffs for this type of insurance.”
Insurers themselves, among other things, talk about a shortage of policy forms: in five problem regions they need more than 380 thousand additional forms.
State corporation as a step of desperation
The head of the expert council on insurance legislation, Alexander, believes that the final decision on the creation of a special state corporation will depend on the further number of complaints about the work of insurers. Thus, according to his data, in 2014, 24 thousand complaints were received from motorists, and in 2015 their number exceeded 53.5 thousand.
“There is no downward trend in complaints,” Koval tells Gazeta.Ru. — Insurance companies are commercial structures.
It is not profitable for them to work in certain regions. Hence the shortage of policies, hence the imposition of additional services.
It has never happened that you had to stand in line at night and sign up to buy compulsory motor insurance. Now RCA agents can issue a policy to any company that may not even exist in the region, and by law the owner must provide the car to the insurer after an insured event. These are the problems that have not been resolved today and are unlikely to disappear with the creation of a state-owned company.
In turn, an independent expert in the field of insurance calls this statement by the Central Bank a “gesture of despair” and at the same time a signal to insurance companies of their readiness to take fairly tough measures if the situation with compulsory motor liability insurance in the regions does not normalize.
“The creation of such a company is a solution to the existing problem of the availability of compulsory motor insurance in a number of regions, where for the vast majority of insurers the sale of policies has become economically unfeasible,” Gavrilov tells Gazeta.Ru. —
At the same time, transferring the regulation of compulsory motor insurance to the level of a state company will mean subsidizing this market by the state.
Since now in a number of regions tariffs turn out to be unbalanced and do not take into account the realities of the market, primarily related to the actions of fraudsters and intermediaries - “auto lawyers”, who buy out insurance events and claims from bona fide policyholders and take advantage of the imperfections of insurance legislation to obtain unreasonable income.
Simply put, the state, that is, taxpayers, will compensate for losses within the framework of compulsory motor liability insurance arising due to imperfections in insurance rates and the market as a whole, which currently fall on the shoulders of insurers.”
Meanwhile, the general director believes that if in the next six months the situation with “car lawyers” and scammers is not resolved, that is, changes are not adopted to the law on compensation in kind and on mandatory inspection, then
private insurance companies may begin to surrender their licenses and the introduction of a state-owned company will become inevitable.
“But this will entail much bigger problems for the state: tariffs will be catastrophically insufficient, and maintaining such a company will cost several tens of billions of rubles a year,” Skvortsov tells Gazeta.Ru. - Tariffs may remain the same, but this will be an illusion - it’s just that the budget, and therefore the whole society as a whole, will take on the problems of “car lawyers” and scammers.
The CEO of Intouch, on the contrary, considers the creation of such a state-owned company a fantasy.
“It is unclear who will create this market participant and why,” Maksimov tells Gazeta.Ru. — How this organization could help the insurance market is also unclear. Now insurers have actually left a number of regions, because there are too many people wanting to make money from them. But in general, according to the Central Bank and the insurers themselves, the MTPL market is not so unprofitable. The main thing is to avoid meeting with such intermediaries.
There may be fewer insurance companies
Currently, 81 insurers have a license for compulsory motor liability insurance.
At the same time, the head of the Central Bank earlier stated that the Central Bank does not rule out reducing the number of insurance companies by the end of the year.
In addition, the Bank of Russia is going to take similar measures against insurance companies licensed for compulsory motor liability insurance, which will not sell electronic policies from January 1, 2017. Let us note that, according to the figures presented at the annual meeting of the RSA, the overall financial result of the work of insurance companies at the end of 2015 is assessed as negative. According to RSA executive director Evgeny Ufimtsev, the total loss of insurance companies amounted to about 300 million rubles.
OSAGO sellers will envelop Chelyabinsk with a network
Today in the Chelyabinsk region a special mechanism should be launched to increase sales of compulsory motor insurance, the purpose of which is to combat the shortage of policies and queues. The decision was made the day before yesterday, so for now it only exists on paper. Сhelfin.ru found out when the promised universal insurance agent will start working and how his work will be organized.
On Monday, May 30, the presidium of the Russian Union of Auto Insurers (RUA) at a meeting approved the principles of the system to increase the availability of compulsory motor insurance services in problem regions, said Igor Yurgens, president of the RCA and the All-Russian Union of Insurers. There are five such regions: the long-discussed Krasnodar Territory, Rostov and Volgograd regions were joined by Chelyabinsk and Murmansk.
The information that the Southern Urals is included in the list of problem regions, on the one hand, is obvious, because in the Chelyabinsk region payments for courts last year amounted to 50%. On the other hand, as often happens in Russia, it took insurers by surprise. Nobody understands how the new principles will work.
Car owners are also confused: they do not understand the meaning of introducing RCA measures. “If there is a single center where you can insure everything and in any company - such as the MFC in the field of public services - then there will probably be some sense. In the meantime, all this is just information noise, and not real help,” says Elena Sokolova, a driver with 20 years of experience. “I don’t understand what exactly will change,” was the answer of the absolute majority of motorists surveyed.
We figured out what changes have taken place in the MTPL market today. Chelfin.ru has at its disposal a newsletter for RSA members, which describes the working mechanism.
Firstly, members of the RSA who do not carry out activities under compulsory motor liability insurance in the Chelyabinsk region are recommended to begin concluding contracts from June 1. For those who are already working, increase the number of MTPL contracts concluded. Work can be carried out through its own divisions or by concluding a bilateral agency agreement with an agent or with another insurance organization.
The use of such a mechanism for purchasing compulsory motor insurance is not an obligation, but an opportunity for motorists: if a person wants to purchase a policy from a specific insurance company, he can contact this insurer directly. Claims for policies sold by an agent will be settled in the normal manner. For companies that do not have their own branches in these regions, their representative in this region will settle the loss, explained Evgeny Ufimtsev, executive director of the Russian Union of Auto Insurers.
Secondly, the mechanism for combating the shortage of forms themselves is described. To organize additional sales, the Presidium of the RSA approved the amount of additional provision of insurance organizations - members of the RSA - with forms of MTPL insurance policies. At the same time, “taking into account the complexity of organizing additional provision of forms in such a short period of time with the involvement of an organization that produces MTPL insurance policy forms, the RSA Presidium decided to provide RSA members with the opportunity to purchase insurance policy forms from other RSA members in a simplified manner in June 2016,” - the document says. That is, in June, due to the emergency, insurance companies can also buy policies from each other, however, with the permission of the union.
That is, we are not talking about creating a separate industry institution - a single insurance agent - as mentioned earlier, but about creating a kind of network between insurance companies. But this is temporary. The emergence of an additional opportunity to purchase compulsory motor insurance is an interim measure to quickly solve the problem of providing motorists with insurance. In the future, a multilateral agency agreement should be concluded between insurance companies in the MTPL market or a separate legal entity should be created.
Vitaly Knyaginichev, director of the retail business directorate at Ingosstrakh, believes that this measure is effective, but can only be temporary, since it does not fundamentally solve the problem with the unprofitability of compulsory motor liability insurance, but only distributes market losses to all players according to a certain quota. “The RSA and members of the insurance community understand this perfectly well, work is underway to correct the situation, in particular, the union has prepared a number of proposals and questions for the Supreme Court to change judicial practice. I note that the distribution of losses between insurers will create serious pressure on the unprofitability of small players with a limited margin of financial stability. Probably, a number of them will be forced to surrender their MTPL license, which will lead to further consolidation of the market,” he explained.
Lawyers agree that the model proposed by RSA for selling policies in unprofitable regions will not justify itself, moreover, it will completely kill competition, strengthen the selection of clients, and create the ground for abuse. Automotive lawyer Yuri Panchenko calls the measures taken by RSA a facelift: “The MTPL system itself in Russia requires revision both from the point of view of legislation and from the point of view of insurers’ policies. In the West, the analogue of a car citizen is a measure of social assistance to drivers, but in our country it is a business that wants to take as much as possible out of the car owner’s pocket.”
Yulia SOROKINA specially for Chelfin.ru
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Today we would like to introduce you to an incredibly talented marketer and insurance sales specialist, Telman Knudson. Telman is the author of the unprecedented charity project Run Telman Run, as well as one of the leading professionals in the field of insurance marketing and sales organization. And today “Insurance Spetsnaz” will introduce you to 10 principles of selling insurance services.
Sales Secret #1
You have to sell only one thing - your status.
Your first concern should not be how to sell insurance to a client. It is not the insurance sales channels that should concern you.
The first and most important thing you need is to have and “sell” the status of an expert, a specialist in insurance services. It’s somehow inconvenient to start an argument about price with an expert. If most of your meetings begin and end with a conversation about the price of an insurance product, this means that you may be a good agent and a good person, but you have not sold the status of an expert insurance agent. This applies to all sales in insurance: sales of insurance products, sales of investment (savings) life insurance, sales of boxed insurance, as well as cross-sales in insurance.
Sales Secret No. 2
You must convey the truth to the client - it is very profitable for you to work honestly.
There is a stereotype in insurance sales that one can expect anything but honest work from an “insurer-salesperson.” It is not necessary to dissuade the client of the injustice of such an opinion in general; it is enough to tell him that you are an expert in insurance, in selling insurance products (see secret No. 1), and also honest.
Sales Secret No. 3
You should sell when you need to, not all the time.
There are no insurance agents who “sell insurance” well; there are agents who skillfully work at all stages: initially attracting a client, qualifying an insurance expert, identifying the client’s needs, directly selling insurance services, responding to objections and signing an insurance policy. Choose your “strong place”, what you do best. For example, maybe you are strong at identifying customer needs or cross-selling in insurance?
Sales Secret No. 4
If the welfare of the entire insurance agency depends on sales results, it would be logical for the entire company to participate in this process.
If the sales team says “we” when referring to insurance sales people, and “they” when referring to everyone else, it is a common problem. The seller has no right not to sell. Especially if he has a sales plan.
The head of an insurance agency must organize sales in insurance. If a salesperson says that he could make more sales of insurance products, but... he is hampered by accounting, a car dealership, and a partner insurance company, this means that he should spend 95% of his time finding clients and transferring them to someone who does not have such excuses . The manager must monitor this.
Sales Secret No. 5
You must make sure that the client cannot compare you with others when choosing an insurance agency or insurance company.
Find a way to differentiate yourself. Don't allow yourself to be in a "it's all the same" situation. Avoid comparisons. If the client’s first phrase is about “the same thing,” then the second will be about a discount. Our positioning occurs in the client's head. He must feel and perceive differences.
If he doesn't see any differences, assume there are none. If a client needs to become an insurance sales expert and give you a year of their life to understand the differences between your insurance agency and your competitors, look for more recognizable and tangible differences.
The differences may relate to the product, additional insurance service, company, but most importantly, the difference should be the insurance agent himself. If we can only partially influence the insurance product and the insurance company, then we, as an insurance agent, can improve ourselves endlessly.
Sales Secret No. 6
You must understand what the client is afraid of.
At the beginning of the 20th century in European countries, sales agents were clowns (“buy attention and talk”), then walking encyclopedias (“kill on the spot with facts about the product”), then special forces (“sell at any cost, despite the client’s needs”), and today they are the client's partners. This is also typical for the CIS market.
Partners respect each other, listen to each other and sign only mutually beneficial transactions and policies. When a client leaves you, promising to think about it, understand: if everything is done right, then he should buy right away; If everything is wrong, then what should he think about? Your know-how is to find out what he is afraid of. And, accordingly, adjust the technique of selling insurance services.
If this is the price of an insurance policy, then you will have one plan of action, if the solvency of the insurance company is another, if there is a lack of your own experience in insurance, uncertainty in the capabilities of your insurance agency - you know what to do.
Sales Secret No. 7
You must manage the client's expectations.
The panicky fear of losing a client leads to the fact that we sometimes generously promise him more than we can offer, or sluggishly limit his unrealistic wishes and expectations. We are once again working with the client based on what is urgent rather than what is important.
For a professional insurance agent, high client expectations are not a problem, but an opportunity. For example, the ability to cross-sell policies (make additional sales of insurance services). In addition, this is an opportunity to ask a dozen questions about previous experience, concerns, required insurance risks, the client’s budget and analyze the decision-making system.
Then the expert will streamline expectations, say what happens and what doesn’t happen, in what time frame, for what money and under what conditions. And the client will understand this. What if your client doesn't understand? It's not his fault, it's your fault.
Sales Secret No. 8
You must create new “value” for the insurance product
The secret is that we can no longer work successfully while remaining within the same framework. The British have long been playing with the words product (product) and service (service), coming up with such combinations as provice and serduct, which indicate that there are not only products without services and there are not only services without products.
What can you offer your client that will improve the insurance service and content of the insurance product?
This is sure to improve your insurance sales performance!
Sales Secret No. 9
You must work harder and differently.
Armand Hammer said: “As soon as I start working 14 hours a day, 7 days a week, I start to get lucky.”
The Russian Union of Auto Insurers (RUA), at a meeting of its presidium on May 30, approved the principles of work of a single agent for compulsory motor liability insurance in problem regions. The mechanism, launched on June 1, is designed to increase the availability of MTPL policies in regions where there is currently a shortage, TASS reports.
At the same time, if initially the list of problem regions included the Krasnodar Territory, Rostov and Volgograd regions, now the insurers have decided to add the Chelyabinsk and Murmansk regions to them.
How, the latest version of the scheme to create a single agent for selling policies is a network of inter-agency agreements between insurers who will sell each other's policies. The number of policies issued for sale in such regions will depend on the market share of the insurer. In this case, each company will be assigned an array of the last three digits of the vehicle passport (PTS). As a result, each car owner will have an insurance company assigned at random.
Meanwhile, as the President of the All-Russian Union of Insurers and RSA Igor Yurgens clarified, the use of such a mechanism for purchasing compulsory motor insurance will not be an obligation, but an option for motorists and a choice. If a person wants to purchase a policy from a specific insurance company, he can contact that insurer directly.
It was also previously reported that the Federal Antimonopoly Service is against the single agent model proposed by RSA.
The head of the Central Bank asked to speed up the adoption of the law on compulsory sales of E-MTPL
The head of the Central Bank, Elvira Nabiullina, called on State Duma deputies to speed up the adoption of the bill on compulsory sales of electronic OSAGO policies (E-OSAGO). This mechanism will increase the availability of compulsory “motor citizenship” for citizens, Nabiullina said, speaking on Monday in the State Duma.
“Now it (electronic OSAGO policy) is used on a voluntary basis. And we see from statistics that to date 190 thousand policies have been issued. This is very little, and we would like to ask our respected colleagues of deputies to speed up the adoption of the law that makes electronic mandatory policies, and this mandatory nature will, in our opinion, improve the accessibility of this instrument for citizens,” Nabiullina said (quoted by TASS).
The head of the Bank of Russia noted that the regulator is aware of all the problems that currently exist in this market. “In order to improve the situation in this area, we have taken various measures, but here is one of the measures where we still see prospects that have not fully, not fully started working - this is the electronic MTPL policy,” added the head of the Central Bank.
Earlier, the press service of the Bank of Russia reported that from January 1, 2017, it is planned to make the sale of electronic MTPL policies from a voluntary form mandatory for insurance organizations.
From January 1, 2017, the Russian Union of Auto Insurers (RUA), together with the Central Bank of the Russian Federation, is introducing a new system for calculating discounts and allowances for the final calculation of the cost of an MTPL policy.
The new one, which will be introduced in 2017, will primarily be tied to the driver, and not to the car. Let us remind you that at the moment in Russia there is a system of bonus-malus coefficients, which is tied to the car and the driver. As a result, according to RSA, about 20 percent of drivers unfairly overpay for compulsory civil liability insurance policies.
For example, a responsible and careful driver has. But this does not mean that the final cost of the MTPL policy when drawing up an insurance contract will be reduced by this coefficient. Since at the moment the compulsory motor liability insurance policy is tied to the vehicle, if a driver with good or accident-free driving is included in the policy of the owner of another car and who is involved in an accident due to his own fault, then the maximum coefficient for a careful driver will be reduced.
From January 1, 2017, it is planned to decouple the MTPL policy from the car and link it to the driver himself. That is, for each driver an individual bonus-malus coefficient (BMC) will be calculated, which will not change due to the accident rate of another driver and car.
Loss classes for each driver (KBM coefficients)
Starting from the new year, the Russian Union of Motor Insurers is introducing 14 individual classes for drivers (from loss class “M” to class 13).
For example, loss class "M" has a coefficient of 2.45. That is, if a driver often gets into violations of traffic rules, then he may be assigned a loss class due to frequent accidents with a coefficient of 2.45. For such drivers, the policy will cost almost 2.5 times more.
Today, these loss classes are tied to the vehicle the driver is driving. Let us remind you of the compulsory civil liability insurance when driving a car; all drivers were assigned class number 1. Further, for accident-free driving, the driver is given a discount of 5 percent. That is, every year the bonus malus coefficient decreases by 0.05 percent. Thus, the maximum discount for 10 years of accident-free driving is 50 percent (coefficient 0.50).
If the driver, regardless of the accumulated discount, then the driver receives an increasing premium for the next insurance period due to a coefficient of 1.55. Unfortunately, in order to return the bonus-malus coefficient to 1.0, you must drive without accidents for at least 2 years.
At present . For example, it is not uncommon for a driver, being the owner of a car, to insure his liability by purchasing a policy for his car, and is also included in the policies of other vehicle owners. As a result, the same driver may have different KBM coefficients. This directly depends on how many drivers are included in a particular policy and what kind of KBM they and their cars have.
But from January 1, 2017, it is planned that each driver will have his own personal motor insurance policy, which will be changed once a year on January 1, 2017.
Let us remind you that now the bonus-malus coefficient changes after concluding an insurance contract for a new term. Having untied the car from the driver, . In addition, starting from the new year, insurance companies will no longer be able to independently calculate the bonus-malus ratio. Currently, RSA is preparing an electronic online system that will calculate an individual BMI coefficient for each driver and transmit it, upon request, to the insurance company for concluding an insurance contract.
Transferring the right of settlement to the KBM to the Russian Union of Auto Insurers will help avoid abuse by insurance companies when concluding insurance contracts. The introduction of a unified base for calculating KBM on the RSA server will completely stop abuse when calculating the cost of compulsory motor liability insurance policies on the part of insurance companies.
How much will the discount on the MTPL policy increase from January 1, 2017?
According to the innovation, from January 1, 2017, the KBM coefficient will be calculated individually for each driver without taking into account the influence of the car.
That is, if the driver is included in someone else’s insurance, then not the average coefficient for two insurances will be calculated, but a more fair one. That is, if the driver has a coefficient of 0.5, then if he is included in the insurance policy of another car owner, then the driver with the maximum discount will not lose the coefficient and.
According to RSA, about 20 percent of drivers will receive a discount of 2 to 15 percent from January 1, thanks to a new method for calculating the final cost of an MTPL policy.
Will the price of a compulsory motor liability insurance policy increase without a limit on the number of drivers?
Unfortunately, the new system for calculating the bonus-malus coefficient from January 1, 2017 will lead to the fact that due to the abolition of linking the cost of the policy to the car, the cost of an MTPL policy without restricting the access of drivers to drive will increase significantly. Let us remind you that today there is no limit on the number of drivers, calculated using the KBM coefficient of 1.80.
As a result, many drivers, after repeatedly getting into an accident through their own fault, realizing that they face the risk of calculating the cost of the policy at a coefficient of 2.45 when concluding an insurance contract for a new term, simply purchase a policy without restricting the drivers’ access to driving a vehicle. This is significantly cheaper than calculating the policy at a coefficient of 2.45. To stop this practice, on January 1, 2017, a KBM coefficient of 2.45 is introduced for all OSAGO policies without restricting the admission of drivers. This will certainly upset many drivers who have purchased policies with no driver limit in recent years. The price increase for such a compulsory motor liability insurance policy will be 13.6 percent.
Will there be a transition period after the introduction of the new system for calculating the bonus-malus coefficient?
Yes, the Russian Union of Auto Insurers establishes that after the start of the new system for calculating the KBM coefficient, a grace transition period will be introduced. For example, for those drivers who are included in more than one MTPL policy and have several types of bonus-malus coefficients, a bonus-malus coefficient will be established (we recall that at the moment in 2016, insurance companies calculate the average bonus-malus coefficient).
So for such drivers, the cost of an MTPL policy may decrease in 2017.
How much will the cost of the policy increase for legal entities and taxi drivers?
From 2017, all legal entities will begin to pay at the average rate. After all, today all legal companies buy an MTPL policy, the cost of which is calculated individually for each car. But from 01.1.17 for legal entities the average value of the BMR will be calculated for the entire fleet owned by the legal entity. face. For those companies that have a large fleet of vehicles, this will of course lead to a significant increase in the cost of annual civil liability insurance for vehicle drivers.
Large taxi fleets will be especially unlucky, where the cars are often the fault of the drivers. After all, starting from the new year, if at least one driver gets into an accident, then in the next calendar period the average value of the MSC for a legal entity (and therefore for the entire fleet owned by the company) will increase significantly.
How will the cost of a compulsory motor liability insurance policy increase if you add to it a driver who, through his own fault, was involved in an accident in the past?
According to the new rules, from January 1, 2017, if the owner of a car will include several drivers in the policy, then the BMR calculation will be calculated based on the driver who has the worst BMR coefficient. Therefore, we recommend that every car owner, when applying for a policy, be careful about who he or she includes in the MTPL policy, because if you include a driver with a high KBM coefficient due to his accident rate, then the final cost of the MTPL policy can be much higher.