Armenian parliament members propose to reduce the prices for mandatory car insurance but insurance companies consider it not reasonable

YEREVAN, September 27. /ARKA/. A number of Armenian parliament members proposed to reduce the tariffs of mandatory car insurance in Armenia but insurance companies consider it not reasonable.

“Our main task is to provide security of the system and facilitate the load of the wallets of our citizens. It is not fair that the citizens, regardless of using the services of insurance brokers, are paying for it”, said member of fraction of opposition party “Dashnaktsutyun” Artsvik Minasyan. He expressed hope that insurance companies can reduce the tariffs.

He also proposed to change the fixed minimum and maximum sizes of insurance payments of mandatory car insurance as it hinders the development of competitiveness in the market.

“If we hinder the development of competitiveness in the market defining fixed tariffs, it is better to make the system public”, he said.

In total, introduction of mandatory car insurance caused more negative than positive consequences. Among positive factors he mentioned reduction of tenseness among the participants of car accident and guarantee of compensation of the damage.

“Negative factors are conditioned not by traffic jams but also additional financial overload of the citizens”, he said.

Representative of association of insurance market participants and Executive Director of the company “Rosgosstrakh Armenia” Gagik Grigoryan spoke against Minasyan’s proposal.

“Reducing of tariffs by 15% can save only 300 drams for car owners monthly … By this we get significant facilitation for citizens”, said Grigoryan.

Liberalization of tariffs, in his opinion, is unacceptable as a minimum in the next 3 years as mandatory car insurance market is not formed yet.

“If we change the defined tariffs, nothing will hinder the appearance of daily forms which will sell mandatory car insurance policy and disappear in some months from the market”, he said.

According to the data published by CBA and adopted by the Bureau of car insurers of Armenia, tariffs for mandatory car insurance liability resulting from the operation of motor vehicles, minimum amount of insurance payments by the contract for personal use of engine power to 80 hp is 25 thousand drams, for taxi- 37 thousand drams, for service cars – 26 thousand drams and the engine power having more than 231 hp – 46 thousand, 66 thousand and 48 thousand drams respectively.

Maximum size of insurance payment by the contract of mandatory car insurance for the cars of personal use with the engine power of 80 hp will be 42 thousand drams, for taxi – 61 thousand drams, for service cars – 44 thousand drams and engine power having more than 231 hp -71 thousand, 110 thousand and 79 thousand drams respectively. ($1- 371.76 drams).-0-

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