The Insurance Authority stated that it gave companies the option to provide a discount on the insurance premium to the driver of the vehicle whose record is free of accidents under a certificate proving that, and according to the percentages set forth in the system, noting that it is the responsibility of insurance companies to adhere to the price tariff system set by the authority in accordance with the system issued by them .
The authority stated to «Emirates Today» that, if it is proven that any company issued an insurance policy under an insurance premium that deviates from the legislations issued by the authority, then the company will be in front of an explicit violation of the provisions of the system, stressing that in this case the authority will take legal measures in accordance with the provisions of the legislation the window.
The managers and workers in brokerage companies told Emirates Today recently that car insurance rates fell by 30% in 2019, compared to 2018, in the context of price competition between insurance companies, noting that some companies have become The Accident-Free Clean Mechanism is used as an excuse to "burn" prices.
Encourage competition
In detail, the Insurance Authority confirmed that it seeks, through its legislations, to regulate the insurance market in the state, and to encourage fair and effective competition between companies, which contributes to providing the best insurance services with appropriate prices and coverage.
The Authority told Emirates Today: “Accordingly, it obliges insurance companies in the event that the competition decides to provide prices, that each company must remain responsible for the integrity of its decision technically and actuarially, and that reflects its previous experience with its customers, and does not lead to exposing the center The company's financial risk or loss of insured rights. ”
The Authority added that, “Based on this, insurance companies are free to compete by providing prices within the limits that are included in the decision of the Board of Directors of the Insurance Authority No. (30) for the year 2016 to issue a system of tariff rates for vehicle insurance.”
Adjust the tariff
And if insurance companies take the mechanism of reducing the owners of clean records as an excuse to reduce prices, the authority clarified that it is "in line with global practices and insurance principles, and to achieve the principle (reward and punishment) and reward good behavior by giving it a reduction in the premium, and in the context of contributing to reducing the number of accidents and deaths, The Authority sought to make an amendment to the vehicle insurance policy tariff system, in accordance with the Insurance Authority Board of Directors Decision No. (41) for the year 2017, so that the company was given the option to provide a discount on the insurance premium to the vehicle driver whose record is free of accidents, according to a certificate proving that, and according to Of the proportions shown in the system Mother".
The authority indicated that “based on it, and since the good behavior of the vehicle driver who did not cause any accident throughout his previous insurance period means that he did not cost the company’s portfolio any amounts, which deserves the reduction if the company sees a justification for that, and it is not permissible to grant the vehicle driver A reduction for this reason except under a written document issued by his previous company or an official authority.
Procedures
Regarding the measures that the insurance authority will take in the event that it is proven that some companies resort to "burning" prices, the authority emphasized that it is the responsibility of insurance companies to adhere to the system of insurance tariffs set by the authority under the system issued by them, and the authority also shows that the results indicate the companies' compliance with legislation Commission".
She added that "if it is proven that any company issues an insurance policy in accordance with an insurance premium that deviates from the legislations issued by the authority, then the company will be in front of an explicit violation of the provisions of the system, in which case the authority will take all legal measures in accordance with the provisions of the legislation in force."
Quality of services
And on the impact of declining prices on the quality of services provided to customers, the Insurance Authority stated that it “aims to protect the rights of the insured and policyholders, by ensuring fair and effective competition, and providing the best insurance services at appropriate rates and coverage, and the insurance rate tariff system issued by the Authority He took care of achieving the best insurance services.
And the authority continued: "In order to maintain fair competition - any company must not offer any insurance product that might affect its reputation, as the lesson is after-sales service that the company is supposed to ensure that it is in the best possible quality and the authority monitors this."
Reduction ratios for owners of "clean records"
In accordance with the decision to amend the price tariff system and standardization of vehicle insurance policies issued by the Board of Directors of the Insurance Authority, the company can grant a 10% reduction in the premium to the minimum premium for the vehicle owner who did not cause an accident that leads to a claim during the previous insurance year, and by 15% % Of the minimum insurance premium for a vehicle owner who did not cause an accident that leads to a claim during the previous two years, and by 20% of the minimum insurance premium for the vehicle owner who did not cause an accident that leads to a claim during the previous three years, in addition to granting a reduction of 10% for the minimum amount of the insurance premium as «Kh Z loyalty to clients of the company », gives the owner of the vehicle when renewing the document with the insurance company itself, not the insurance is transferred to another person.
If the company proves to issue an insurance policy under a premium that breaks the legislation, then it will face an explicit violation case.