Are consumers profiting from the "price war" of car insurance fees? 【 Cash delivery, shopping coupons and other "rebates" are becoming more and more intense, and regulatory authorities have issued notices to guide insurance companies to operate in compliance and prudently]

"The highest handling fee rate has reached more than 30%, the competition for customer acquisition is fierce, and the rebate is pushing higher and higher..." A business officer of a large property insurance company revealed that the phenomenon of "vicious competition in commercial auto insurance fees" has risen.

In response to the rise of high fee competition in some regions and institutions, the State Financial Regulatory Administration recently issued the Notice on Matters Related to Regulating the Order of the Auto Insurance Market, which began to regulate the order of the auto insurance market from five major aspects.

Cash back for maintenance

Car insurance "rebates" are strong

Over the years, the regulatory authorities have repeatedly ordered and rectified the chaos, requiring insurance companies not to engage in unfair competition, and property insurance companies and insurance intermediaries not to give or promise to give benefits other than those stipulated in the insurance contract to the policyholder or the insured by returning or giving away cash, prepaid cards, negotiable securities, insurance products, shopping coupons, in-kind and point deductions. Illegal payment of benefits other than those stipulated in the insurance contract shall not be disguised by participating in promotional activities organized by other institutions or individuals.

Since September 2020, after the comprehensive reform of motor insurance, the motor insurance market has shown a "double reduction" in premium prices and handling fee rates. However, since the beginning of this year, the phenomenon of "vicious competition in handling fees" in the auto insurance market has risen again.

A number of car owners told the Beijing Youth Daily reporter that the "rebate" phenomenon of commercial car insurance still exists, and the "rebate" has not become smaller. On some social media, there are also insurance company salesmen who send out "rebates" promotions to solicit customers.

In an interview, Mr. Liu reported that the price of commercial auto insurance has indeed become cheaper in recent years, and it has not been insured for 6 consecutive years, counting the more than 2000,<> yuan of cash returned, which is hundreds cheaper than last year.

Ms. Zhang's private car insurance is about to expire, and this month she has received many calls from insurance company clerks, all of whom have given more discounts than the contract quotation. Calculated commercial insurance, compulsory insurance and vehicle and vessel use tax totaling 3791 yuan, after placing an order through the APP, you can return 760 yuan, and even a salesman wants to personally add 100 yuan to her account, and send another maintenance, a paint repair, and 6 car washes. Ms. Zhang said: "I will definitely shop around and see which one is the best deal." ”

Vicious competition for fees is on the rise

In the long run, it may affect the interests of consumers

"Now facing a dilemma, the leading large insurance companies have high profits and sufficient expenses, if they take the lead to grab market share, small and medium-sized insurance companies will lose the market if they do not follow, and they will not necessarily be profitable." A car insurance business person told the Beiqing News reporter that the handling fee rate of compulsory insurance is about 4%, and the handling fee rate of commercial insurance is about 15%. In order to grab land and compete for share, some property insurance companies have given a handling fee rate of more than 30% through unfair competition, which has greatly deviated from the reasonable range of the car insurance handling fee rate.

These non-public fee concession competitions are mainly divided into bright lines and dark lines. The so-called "bright line" concession means that the car insurance salesperson returns part of the commission obtained from the sale to the customer in order to obtain customers, mainly personal behavior; The "dark line" concession is that the insurance company pays the handling fee to 4S stores, intermediaries and other channels, which is regulated by the insurance company.

In fact, this vicious competition in fees has not fully benefited auto insurance consumers, but has provided opportunities for arbitrage between different channels in the auto insurance market. If the intermediary company's fee rate is higher than that of other channels, other channels will list suitable customers to the intermediary company, earn higher fees from insurance companies, and finally the two parties can share the difference between the handling fees. In the long run, the vicious competition in the auto insurance market is bound to ultimately affect the interests of consumers.

Supervision intervenes to rectify the chaos

It is required to strengthen the control of fee accounting

Why do insurers still have to seize the market through "rebates" despite repeated orders from regulators? How can auto insurance companies compete normally?

Xu Jianping, vice president of Auto Technology, said that "exchanging fees for market share" has always been a persistent problem in the property insurance industry.

Once large insurance institutions take the lead in competing for market share under the pressure of performance, other market players will definitely follow suit and quickly lead the competition for market fees to heat up, which is likely to return to the eve of the comprehensive reform of motor insurance. This vicious competition in fees will not only not benefit consumers, but insurance companies themselves will also suffer a lot of losses.

From the perspective of insurance companies, the main root cause of the competition behavior of handling fees in the auto insurance market lies in the mechanism assessment of the head office, and the excessive business growth indicators lead to the grassroots buying business regardless of the cost, which directly leads to vicious competition chaos such as handling fees and order grabbing. It is suggested that insurance companies should standardize from the assessment standards and formulate reasonable business objectives.

The vicious competition in fees in the auto insurance market has attracted the attention of regulators. Recently, the Property and Casualty Department of the State Financial Regulatory Administration issued the Notice on Matters Related to Regulating the Order of the Auto Insurance Market to guide insurance companies to operate in compliance and prudently.

The Circular regulates the order of the auto insurance market from five major aspects, including strictly prohibiting insurance companies from blindly competing for scale and market share, issuing unrealistic premium growth tasks to branches, and requiring insurance companies not to deviate from the actuarial pricing basis and sell motor insurance products at prices below cost. Insurance companies are required to strictly manage internal controls such as expense budgeting, approval, accounting, and auditing, list various operating and management expenses according to the facts, and strengthen the control of handling fee accounting. Text/Reporter Lin Lishuang Coordinator/Yu Meiying

memory

The regulatory authorities began to regulate the order of the auto insurance market in five aspects

The Property and Casualty Department of the State Financial Regulatory Administration issued the Notice on Matters Related to Regulating the Order of the Motor Insurance Market, which regulates the order of the auto insurance market from five major aspects.

　　1

Firmly establish the concept of compliance management and strictly implement various regulatory requirements.

　　2

Further strengthen the sense of responsibility and the overall situation, and consciously assume the main responsibility of maintaining the order of the auto insurance market.

　　3

Property and casualty insurance companies should attach great importance to the underwriting of high-risk vehicles such as motorcycles and commercial vehicles.

　　4

All CBIRCs should continue to monitor the dynamics of the auto insurance market, focus on the cost level of various institutions under their jurisdiction, and strengthen the supervision of the implementation of auto insurance rates.

　　5

All CBIRCs should continue to maintain the high-pressure situation of auto insurance supervision, crack down on small ones early, and prevent the behavior of individual institutions from affecting the stability of the auto insurance market in the entire jurisdiction.