BIZCHINA / Center
CIRC may lower compulsory vehicle liability premium
(chinadaily.com.cn)
Updated: 2007-04-29 13:43
The China Insurance Regulatory Commission (CIRC) assistant chairman Yuan
Li said recently the regulator may allow insurance companies to adjust
the premium rate for compulsory vehicle liability insurance.
The regulator will reset the premium rate after it has done more research
and analyzed operational conditions of insurance companies. The CIRC will
also refer to the performance of insurers who offer this kind of
insurance. It will also hold hearings if the premium is increased is too
much, according to Yuan.
Wang Wen, dean of the insurance department at the University of
International Business and Economics, said the CIRC should consider
regional disparity in setting the premium rate. He also added that, as a
compulsory insurance, the premium rate should be lowered due to the
generous profits insurers are making now.
Li Ruojin, a professor of the Central University of Finance and
Economics, said the premium rate should be set depending on the different
models of cars and the drivers.
Shanghai is leading the way in practicing a floating premium rate, as
shown by data from the CIRC Shanghai Bureau. In the first quarter of this
year, 40.7 percent of a total of 409,200 compulsory vehicle liability
insurance policyholders paid less premium insurance, on average, only 15
percent of them spent more on their premiums, and 44.3 percent paid the
same.
Currently, the compulsory vehicle liability insurance covers both lives
and property, but Wang said the insurance should cover more compensation
for personal injury. If the property coverage was excluded in the
insurance, the premium rate should be lowered further.
Huang Xueyuan from China Continent Property & Casualty Insurance Co Ltd
said, the compulsory insurance looks like extensive coverage, but the
maximum compensation for property is only 2,000 yuan (US$258.73), which
is meaningless for a vehicle owner.
(For more biz stories, please visit Industry Updates)
Learn Chinese, Learn Mandarin online
No comments:
Post a Comment