SERBIA: inflation triggered a 12% - 15% rise in the MTPL premiums

2 February 2023 — Daniela GHETU
MTPL premiums went up, depending on the insurance provider, by 12% - 15% for all vehicle categories, reported quoting the Association of Insurers of Serbia (UOS). After the "prices war" in August 2022, this time the prices are harmonized with the National Bank of Serbia (NBS), the association said.

"This is the first price increase since July 1, 2014. The main reason is global inflation, which has led to drastically higher prices for spare parts for vehicles, service hours and used parts, which are benchmark prices for determining the amount of damage. In addition, there are more and more hybrid vehicles whose spare parts are significantly more expensive and more susceptible to failure, such as the battery, which also affects the price of the policy. These are the main reasons why the compulsory auto liability insurance policy has become more expensive. If we add to these arguments the increase in retail prices since 2014, the new prices are in fact a premium on this basis, returning to the level of eight years ago", UOS explained.

According to traffic safety expert Milan Bozovic, the increase in the MTPL premiums will allow insurers to cope with increased repair costs, especially considering that the loss calculation method, unchanged since its approval by the National Bank of Yugoslavia some 40 years ago, provides as input data for the indemnity calculation the value of the car and the price of spare parts on the day of the damage.