Direct claims settlement system for MTPL insurance in Belgium Daniel Frala Warsaw Datassur September 2009
The Belgian motor insurance market Source: CEA www.cea.assur.org
The Belgian motor insurance market Top 10 (Economic groups in 2007) • AXA/Winterthur 27.26% • Ethias 15.78% • AG Insurance Belgium 13.69% • KBC 11.47% • P&V Assurances 7.99% • Dexia Insurance Belgium 5.66% • Mercator 5.62% • Allianz 4.06% • Generali Belgium 2.13% • Fédérale Assurance 1.56% • Market share of the top 15 99%
The Belgian motor insurance market Number of insurance companies offering motor insurance in 2007 • Belgium 65 • France 119 • Poland 29 Source: CEA www.cea.assur.org
The Belgian motor insurance market Vehicle fleet as at 31 December 2008 • Cars 5,086,750 • Vans 561,300 • Motorbikes 384,310 • Agricultural tractors 170,500 • Lorries 104,810 • Road tractors 48,680 • Special vehicles 47,260 • Civil engineering equipment 39,200 • Agricultural equipment and cultivators 18,670 • Buses and coaches 15,890 • Total 6,477,400
The Belgian motor insurance market (2007) Vehicle fleet • Belgium 6,300,000 • France 38,640,000 • Poland 16,701,000 Source: CEA www.cea.assur.org
The Belgian motor insurance market RDR (direct settlement compensation fund) figures 2007 2008 • Number of claims 254,425 261,500 • Loss burden €382,223,000 €411,800,000 • Average claim cost €1,502 €1,575
Basic principles of RDR The victim’s insurer (‘direct’ insurer) may compensate its policyholder in place of and on behalf of the insurer of the party responsible (‘adverse’ insurer), within the limits of liability specified in the list of cases. RDR settlement is permitted even in the event of injury, provided there is no disability or death.
Basic principles of RDR Three agreements forming a single, indivisible whole: • The loss assessment agreement • The RDR agreement • The recovery agreement
Loss assessment • The direct insurer mandates its own loss assessor to assess the damage to its client’s vehicle. • In all cases, the insurer of the party presumed responsible may have the loss assessment monitored by its own loss assessor. • Each company pays its own loss assessment costs.
Loss assessment • Quantify the compensable damage • Photograph the damage and provide a detailed description of it • Provide technical arguments in response to any queries from the mandator.
Loss assessment • The adverse loss assessor will act no later than seven days after being first contacted by their colleague. • Failing this, the direct loss assessor may establish a figure alone, although this must not exceed €25,000. • The adverse loss assessor must respond within seven days to the proposal made by the direct loss assessor. • Failing this, the direct loss assessor may establish a figure alone, although this must not exceed €25,000.
RDR management Conditions of application • Accident in Belgium where the civil liability of a third party is partially or fully established • Contact between automotive vehicles • Registered (B) or otherwise • Normally based in Belgium • Subject to an insurance requirement • Identified and covered for civil liability by member companies
RDR management Different scenarios (cases) on the list • Vehicles driving in the same direction • Vehicles driving in opposite directions • Requirement to give way • Stationary or parked • Manoeuvres and special cases
X Y Vehicles driving in the same direction Case 13 Scenario based on Article 12.4 of the Belgian Highway Code • Vehicles X and Y are driving in the same direction in different lanes. • Vehicle Y changes lane OR vehicle Y changes direction, thereby cutting across vehicle X.
X Y Vehicles driving in opposite directions Case 20 Scenario based on Article 15 of the Belgian Highway Code • The two vehicles must be driving in opposite directions on the same carriageway. • It must be possible to determine the position of the vehicles in relation to the centre of the carriageway. • Only vehicle Y encroaches onto the part of the carriageway intended for vehicles driving in the opposite direction.
Manoeuvres Case 50 PARKING Y X Y pulls out of its parking space.
The recovery settlement agreement • The damage amount paid is settled via a compensation fund (Datassur) • Up to €8,500: on the basis of the system of average cost price • Between €8,500 and €25,000: recovery of real cost.