Frequently Asked Questions
Question: What is new about third party vehicle liability insurance?
Reply: the "Grow Italy" measures address vehicle insurance premiums, working on four fronts: compensation, fraud, security and transparency. It is a measure that became necessary as a result of increased premiums. ISVAP (the Private Insurance Oversight Institute) announced in 2010 that claims against insurance companies had risen by 10 percentage points. Third party liability is the sector most affected.
These are the most important novelties:
A. Specific compensation. The first novelty is that the insurance companies may make compensation for vehicle damage "in a specific form". In other words, they may offer to repair the vehicle instead of paying cash by way of compensation. Anyone opting for damages "of equivalent value" (in other words to be refunded the repair costs) will obtain a 30% reduction of the damages paid in the specific form.
B. Combating fraud. Fraud will be combated using a number of instruments, of which two are particularly important. The first is the requirement for all insurance companies to submit a detailed annual report to ISVAP on fraudulent claims and the countermeasures adopted. The insurance company may decide not to pay damages, if the claims databank gives rise to suspicion of fraud. The second means is to inflict penalties for false insurance discs and to punish insurance adjusters who sign false invalidity claims following a road accident.
C. Safety. The "black box" has been introduced. This is an electronic device which makes it possible to record what occurs in the vehicle and the events leading up to accidents. The installation of the black box is optional for the insured. However the insurance companies will pay the cost (which grant a discounted premium).
D. Transparency. To lower vehicle insurance premiums, insurance companies will be obliged to notify the insured of offers from at least three different companies, guaranteeing the maximum transparency with regard to their contractual terms and conditions. Transparency provisions are designed to protect the insured, as well as the insurance companies. A number of interesting figures may be considered. In 2011, ISVAP identified 35 "phantom" companies which were not authorised or licensed to operate in Italy. In 2010, conversely, there were almost 70,000 fraudulent insurance claims to the detriment of the insurance companies.
Page published on 13/01/2012
