Azerbaijan fights against insurance fraud
By Vusala Abbasova
The State Insurance Supervision of Azerbaijan's Finance Ministry has decided to use electronic policies to combat insurance fraud.
This remark was made by Namig Khalilov, the head of the State Insurance Supervision during the 6th Azerbaijan International Insurance Forum in Baku last week.
He noted that the sale of ordinary paper-based OSAGO (compulsory insurance of liability of owners of vehicles) policies by insurance agents, which are often liable to fraud cases, can't be stopped.
The cheaper costs of OSAGO’s electronic policies will however attract consumers, and the decline in the value of the online insurance policies might be virtually offset by the increase in online sales.
Currently, the government is considering the amendments to the insurance law, as well as the implementation of the methods of online policies sales.
The online insurance policies will be available for everyone through ATMs and POS terminals after the e-policies transition.
The amendments were added to the law "On compulsory types of insurance" adopted in 2011, and since then, some 26 insurance and one reinsurance company have been created in Azerbaijan.
According to the law on compulsory types of insurance, the basic cost of an insurance policy on OSAGO is 50 manats, which applies to vehicles with an engine capacity of 1,500 cubic centimeters. The price increases from a coefficient of 1.5 to 5 in engines that are 5,000 ccm or more.
From the first half of 2015, insurance companies have signed 476,000 insurance contracts on OSAGO. Due to the signed contracts, the premium revenues gathered amount to 36.4 million manat.
The number of insurance policies on OSAGO increased by 14 percent in this period compared to January-June 2014.
Vehicles on the road without appropriate insurance will be fined 50 manats for individuals, 100 manats for officials, and 300 manats for legal entities.
The official exchange rate was 1 USD/1.049 AZN on July 6.
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