Car loans have created demand for comprehensive insurance with limited coverage

In auto insurance, the demand for cheaper and more profitable for insurers truncated comprehensive insurance with limited coverage has begun to grow. According to experts, the driver of the trend was the position of banks that are ready to accept mini-hull insurance in car loans. Experts note that clients often continue to use just such policies even after repaying loans, and the Central Bank is going to stimulate mini-casco insurance.

A number of large insurers are observing an increase in sales of truncated motor vehicle insurance policies, according to a Kommersant survey. Such policies cover either only theft or only damage. In its full version, comprehensive insurance covers theft, damage, and other risks, such as fire or falling into water. According to Banki.ru, the average price of full comprehensive insurance is 51.7 thousand rubles, while mini comprehensive insurance is about 13 thousand rubles.

In VSK, the number of such mini-policies grew by almost 60%, exceeding 277 thousand units at the end of 2023. Renaissance Insurance showed more than double growth, to 40 thousand contracts. Sovcombank Insurance noted an increase in the number of truncated contracts by 15%. In the fourth quarter of 2023, the number of concluded truncated motor insurance contracts was 21% higher than in the first, Rosgosstrakh says.

The Russian Union of Auto Insurers (RUA) confirms the growth of truncated motor insurance coverage. The number of comprehensive insurance contracts as a whole increased from 4.7 million to 6.6 million, the insured amounts increased by approximately 10%, while the average premium decreased from 25.6 thousand to 20.5 thousand rubles, it follows from the union’s data. This indicates an increase in the share of truncated contracts, they explain.

Dealers have also noted an increase in sales of truncated comprehensive insurance. On average, over the past year, the demand for mini-hull insurance increased by 30%, and the share was already 30% versus 10–15% in 2022, says Alexander Sagun, managing partner of GTK-Auto. Most often, with the help of mini-casco, motorists try to protect budget brands, in particular Kia, Hyundai, Lada, Renault and Nissan, as well as Chinese cars, he adds.

According to experts, the trend is primarily due to the fact that banks began to accept truncated comprehensive insurance policies for car loans. This was reported by Sovcombank Insurance and Sravni.ru. “Most cars are taken out on credit, and comprehensive insurance becomes actually a mandatory type of insurance, since when applying for a car loan, the purchased car becomes collateral for the bank, and the insurance serves as a guarantee of the return of the money received as a loan,” explains Alexander Krainik, director of insurance business development at Sravni.ru. .

The banks interviewed by Kommersant did not respond to requests. According to ADB Vice President Alexey Voylukov, the main thing for banks is to have insurance against theft and serious damage to the car, which covers a truncated motor vehicle insurance policy. At the same time, the bank understands that the cost of such insurance is significantly lower and the client is more likely to be able to purchase it. However, in the case of an insurance contract with truncated coverage, the bank may increase the loan rate, warns B1 partner Tatyana Samsonova.

Many car owners continue to purchase truncated insurance even after repaying the loan, because it is cheaper, says Alexander Makarov, head of the project office of the Banki.ru insurance vertical. At the same time, policies with truncated insurance coverage are also beneficial for insurers, since they allow them to reduce the frequency and size of losses, adds Ms. Samsonova. In particular, according to RSA, the number of thefts in the Russian Federation has decreased by almost 30%, and cases of total destruction of cars have decreased by 20%.

This year, sales of truncated comprehensive insurance will continue to grow, experts say. In the first quarter they have already increased by 8% year on year, they say in Rosgosstrakh. At Reso-Garantiya, the growth was 11%. Moreover, the other day the Central Bank announced its intention to consider ways to stimulate the sale of motor insurance policies with limited coverage in order to complement the range of protection provided by compulsory motor liability insurance.

Yulia Poslavskaya