1. Warsaw International Motor Insurance Forum – 8/9 May 2008 1 Direct settlement mechanisms and Independent claims adjusters The French experience

2. Warsaw International Motor Insurance Forum – 8/9 May 2008 2 Summary Direct settlement mechanisms and Independent claims adjusters 1.Direct settlement genesis 2.The IDA agreement 3.Independent claims adjusters’ status

3. Warsaw International Motor Insurance Forum – 8/9 May 2008 3 1958 : compulsory motor third party liability insurance   Length of the property damages compensation Accident circumstances set by police forces : difficulties to obtain the legal report No adjusters to evaluate the damages Heavy costs for claims handling   C onsequence Insured and insurers unsatisfied 1. Direct settlement genesis

4. Warsaw International Motor Insurance Forum – 8/9 May 2008 4 Different steps for direct settlement agreements   First steps : the basis 1953 : Scale on liability rules 1956 : Advanced inclusive settlement for accidents between 2 vehicles 1960 : First standard form report Evaluation agreement by the direct insurer (the victim’s own MTPL insurer)   1968 : Direct settlement agreement IDA : ‘Indemnisation Directe de l’Assuré” Extended to all motor insurers 1. Direct settlement genesis

5. Warsaw International Motor Insurance Forum – 8/9 May 2008 5 General principles   Scope : accident between 2 vehicles   Compensation of property damages by the victim’s own MTPL insurer   Scale of liability rules according to the information given by the standard form report   Penalties for the direct insurer who let the insured introduce a legal procedure against the liable MTPL insurer 2. The IDA agreement

6. Warsaw International Motor Insurance Forum – 8/9 May 2008 6 A specific example   The vehicle “A” does not stop on the red light and crashes into the vehicle “B” 2. The IDA agreement The driver of vehicle « A » is liable A B

7. Warsaw International Motor Insurance Forum – 8/9 May 2008 7 Out of the agreement IDA A’s insurer compensates B, after some legal exchanges with B’s insurer B’s insurer makes a recourse against A’s insurer according to the scale of liability rules B’s insurer compensates B A B 2. The IDA agreement

8. Warsaw International Motor Insurance Forum – 8/9 May 2008 8 Extension of the scope of the agreement   1974 : for any kind of accident, no matter the number of vehicles involved   1977 : possibility to make telematic recourse exchanges   1992 : a compensation “chamber”   1993 : compulsory telematic recourse exchanges in case of accident with property damages under 6 500 € Fixed sum of recourse : 1 204 € (annual average of repair costs)   2003 : IRSA 2. The IDA agreement

9. Warsaw International Motor Insurance Forum – 8/9 May 2008 9 The net effects   No disputes 1 600 000 recourses in IDA per year 150 cases submitted for arbitration   Standard form report formalized No more police reports The legal forces only intervene in case of bodily injury accidents   Improvement in the client service Turn over : 12 %   Actualization of the agreement by a technical Commission 2. The IDA agreement

10. Warsaw International Motor Insurance Forum – 8/9 May 2008 10 The adjuster’s tasks   Verifies if the damages is caused by the accident   Evaluates with the repairman the extent and costs of the repairs   Detects any frauds   Certifies the vehicle is road worthy 2. Independent claims adjusters' status

11. Warsaw International Motor Insurance Forum – 8/9 May 2008 11 The professional governance   Diploma certified since 1973 Compulsory exams   National registry held by the Ministry of Transportation About 2 000 certified members registered on the list   Disciplinary Commission Suspension or decertification of members 2. Independent claims adjusters' status

12. Warsaw International Motor Insurance Forum – 8/9 May 2008 12 The relationship with insurers   Each insurance company has it own motor experts network   Contributes to make faster the settlement of claims When combined with the direct settlement agreement mechanisms   But the adjusters are independent 2. Independent claims adjusters' status

13. Warsaw International Motor Insurance Forum – 8/9 May 2008 13 Thanks for your attention