Leaders of the transport insurance market – RESO-Garantia and Ingosstrakh – offer insurance by an average of 10-11% more expensive than the market price. The cost of insurance policy on some car models in these insurance companies is almost twice higher than that of other market players. Despite this, RESO-Garantia and Ingosstrakh not only hold the lead, but even increased their market share in 2015. Such data is contained in a study made by National Rating Agency (NRA).
In the framework of the study were conducted calculations on the cost of car insurance policies for an average car owner for the three most popular models of cars in the three most popular segments.
Based on the data of Avtostat agency, the best-selling cars in Russia in the 1H of 2015 are Lada Granta (overall first place in all classes), Hyundai Solaris (first place in the Golf class), Toyota Camry (first place in the Business class).
The calculations are made for an average policyholder according to TNSGlobal company (Russian citizen, male, 30 years and above, more than 6 years of driving experience, one policyholder in a policy, insurance is purchased in Moscow). The calculations were officially provided by insurance companies of the top 10, which agreed to take part in the NRA's study (a total of 9 companies).
So, the average cost of insurance for all three of the selected car brands amounted to 232.4 thousand rubles. At the same time, in RESO-Garantia the indicator is higher than this average by 10% (255.8 thousand rubles), in Ingosstrakh – by 11.7% (259.7 thousand rubles). For comparison: in Renaissance Insurance, on the other hand, it is cheaper by 39% (141.6 thousand rubles), in Rosgosstrakh – by 27% (170.5 thousand rubles).
In particular, the cost of transport insurance for Toyota Camry in RESO-Garantia (151.8 thousand rubles) and Ingosstrakh (164.6 thousand rubles) is almost two times higher than that of such participants in the study as Rosgosstrakh (92 thousand rubles) and Renaissance Insurance (97.8 thousand rubles), and by 20-25% higher than that of MSK Insurance Group (123.3 thousand rubles) and AlfaStrakhovanie (123.7 thousand rubles).
At the same time, RESO-Garantia and Ingosstrakh are the leaders in terms of collected premiums in the first nine months of 2015 – 21.7 billion rubles and 20.3 billion rubles respectively. Both insurance companies increased their market share in the past year. In the first nine months of 2015, the share of RESO-Garantia has reached 18.8% (in the first nine months of 2014 it amounted to 12.3%), the share of Ingosstrakh – 14.8% (used to be 12.6%). The share of the two market leaders – RESO-Garantia and Ingosstrakh – accounts for about 30%. Thus, based on the results of the study, almost every third policyholder overpaying for his car insurance by an average of about 10% compared with the market price.
The Head of Insurance Sector Analysis at NRA, Tatyana Nikitina, especially noted that the segment of ground transport insurance is now one of market anti-leaders. According to her, in the first nine months of 2015 the amount of land transport insurance contracts decreased by 1 million.
The reasons are a sharp decline in new cars sales, as well as falling incomes. It is also affected by the sharp increase in tariffs by most insurers in late 2014 – early 2015 (an average premium amounted to 54.3 thousand rubles in 2014, and already 61.1 thousand rubles in the first 9 months of 2015). However, these rates were not demanded by the market, so the insurers were forced to lower them a bit in 3-4Q of 2015.
‘But for many clients,’ said Tatyana Nikitina, ‘cost of the policy exceeded a ‘psychological level’, which, combined with the fall in real incomes, contributed to the denial of insurance. For those who continue to allocate from their budget the money for insurance, the issue of compliance by the insurer with its obligations becomes the most important. Insurers with a good reputation and high ‘people's rating’ value their services as more expensive. This allows RESO-Garantia and Ingosstrakh to increase market share, despite the difficult situation in the economy, including in the car and insurance markets.’
According to the Head of Retail Insurance Product at RESO-Garantia, Ekaterina Zakharova, ‘the price of car policy in the company takes into account many factors.’
‘We constantly analyze loss-making and, if we reveal some new indicators that affect it, we introduce them to the tariff calculation formula. Collection and analysis of new data is ongoing and the ultimate goal of this work is to establish for virtually each individual customer a fair individual tariff,’ explained Ekaterina Zakharova.
According to her, there always will be insurers in the market that offer significantly lower tariffs, but in most cases this would mean incorrect calculation or deliberate dumping.
‘Both lead to a deterioration in the result of car insurance portfolio, the main product of the majority of insurance companies, which in the current difficult economic situation may lead to the negative result of the activities of the entire company,’ highlighted the expert. ‘This, in its turn, may adversely affect the security of clients. Car insurance policyholders mostly understand these consistent patterns and therefore opt for the insurance not the cheapest price offers, but the best ratio of price, reliability and level of service of an insurer.’
Deputy CEO of AlfaStrakhovanie, Tatyana Puchkova, said that the company ‘monitors prices on car policies on a monthly basis and strive to ensure that the prices for the target brands and models are on a par with the prices of major players.’
‘Our task is to prepare a competitive proposal, it should be beneficial for the insured, but at the same time, not to be dumping,’ said Tatyana Puchkova.
Deputy CEO of Insurance Telematics Department at Meta System Rus, Timur Kuzeev, believes that the indicators of the volume of premiums collected in RESO-Garantia and Ingosstrakh, ‘due solely to the active work of these companies in their sales channels.’
‘For RESO-Garantia it is mainly retail and agency network (dealers, brokers), for Ingosstrakh it is the retail network (dealers and brokers). You should also take into account the administrative resources of these companies, which have a large portfolio for the previous period of insurance and, therefore, the accumulated amount of losses, which than capably managed in negotiations with retail players – dealers. Dealers, in response to the resulting maintenance resource, put policies of these companies in the first places. In other words, the choice of customers is achieved through active work with vendors in the retail network and the use of its maintenance resource,’ said Timur Kuzeev.