1. Presentation to the Motor Insurance Bureau of the Republic of Macedonia. Direct Motor Claims’ settlement Jean-Pierre Daniel Skopje Nov.22. 2010.

2. www.insurance-surveys.com2 What are the objectives ? From a commercial perspective. –To speed up the claims’ settlement. –To give a better service to the customer as he/she will be treated by his/her own insurance company.

3. www.insurance-surveys.com3 What are the objectives ? From a technical perspective. –To control the claims costs. Thanks to the virtuous influence of the lump sum. In decreasing the administrative expenses due to claims management. In removing legal expenses originated by court claims settlement. In impeding the implementation of “no win, no fees” offices.

4. www.insurance-surveys.com4 Some facts. Material damages car accidents –Are so numerous that it is impossible to deal with them in courts. –It is often impossible to know who is really guilty. –Are not ( will not be ? ) such a big deal for drivers.

5. www.insurance-surveys.com5 Some figures. Number of MTPL accidents. –France : 1 704 000 37 million vehicles. –Italy : 3 370 000 42 million vehicles. –Germany : 3 801 000 ( including bodily injuries ) 55,5 million vehicles

6. www.insurance-surveys.com6 Direct indemnification of the insured. Established in 1968. Agreement between insurance companies. So deeply implemented in the market that it seems compulsory.

7. www.insurance-surveys.com7 Direct indemnification of the insured. Company of the driver at fault. –Receives the amicable statement. –Pays the lump sum to the opposite company. Company of the driver not at fault. –Receives the amicable statement. –Assesses the claim. –Pays the body shop. –Claims for a lump sum the opposite company.

8. www.insurance-surveys.com8 Direct indemnification of the insured. Applies to any motor claim. Settles only material damages. Applies in this simple way if the damages do not exceed 6500 €. The lump sum : 1204 € = average cost of material damages claims below 6500 €.

9. www.insurance-surveys.com9 Direct indemnification of the insured. If the damages exceed 6500 €, –The company of the driver not at fault has to invite the opposite company to assess the damages. –The company not at fault claims for the total amount of the damages.

10. www.insurance-surveys.com10 Direct indemnification of the insured. Claiming for a lump sum is the key factor of success. –On one hand, as the company settles the claim of its customers, it treats him well. –One the other hand, as the company which settles the claim receives only a lump sum, it has no interest in exaggerating the cost of the repairs.

11. www.insurance-surveys.com11 Why does the system work ? Each company receives a copy of the amicable statement. Thanks to a table part of the agreement, each company immediately knows which driver is at fault.

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13. www.insurance-surveys.com13 How does the system work ? 13 cases depending on the position of the cars. Assessment based on objective elements. –100% at fault, –50%/50% –Not at fault. 92% of the accidents = 0/100% 8% = 50%/50%

14. www.insurance-surveys.com14 Why does the system work ? In case of a disagreement between companies, –Each company has an “IDA correspondent” who will speak with the “IDA correspondent” of the opposite company. –Each year only 60 cases are settled by the arbitration court established by the agreement.

15. www.insurance-surveys.com15 Administrative issues. A clearing house has been established on a non for profit basis. For the day 25 of each month, each company sums up all the claims it has paid for each of the other market participants. These amounts are compensated between insurance companies. In case of delay in the payment of the compensation a rate of interest of 5% per month applies.

16. www.insurance-surveys.com16 In other countries. In Spain and Italy, exactly identical agreements. In UK and Germany, no market agreements but agreements between some companies.

17. www.insurance-surveys.com17 Settlement of light bodily injuries. Since 2002 an similar agreement has been set up to “light” bodily injuries. No disability or disability < 5%. A table has been agreed by insurance companies to assess the compensation of injuries. Allows to settle 85% of bodily injuries claims.

18. www.insurance-surveys.com18 Settlement of light bodily injuries. The company of the driver at fault. –Pays back the company of the driver not at fault. The company of the driver not at fault. –Assesses the damages of the victims. –Indemnifies the victim. If it pays into the frame of a table, claims for the amount paid. If it pays over the table, bears the payment in excess.

19. www.insurance-surveys.com19 Thank you for your attention All questions are welcomed