Bank of Russia alerts insurers about unfair practices
The regulator has published several standard examples of unfair practices. These were identified in the course of conduct supervision over the activities of insurers, including in the sphere of OSAGO.
According to the regulator, it is inadmissible when insurers force a victim to conclude a tripartite agreement with a car service shop and an insurance company, and when the conditions of such agreement differ from the ones determined by the law for OSAGO. In particular, on the one hand, this agreement does not specify the timeframe for repair works and, on the other hand, it is possible to enter additional information without a prior consent of the car owner. There exist other inadmissible situations, when a repair order form of an insurance company has a clause on the victim’s consent to have used or re-manufactured components for the repair of his/her car and to extend the time of the repair.
In some cases, insurers violate the right of car owners to buy the OSAGO policy. To ensure only a formal compliance with law, insurers do not refuse their services to car owners, instead they refer them to other branches to have their cars examined, where they have to wait in lines, and repair time may be artificially extended. This practice was specifically wide-spread with regard to the owners of motor-cycles and trucks. The Bank of Russia views such practice as violating the rights of financial consumers and recommends that insurance companies either have vehicles examined by the same branches where car owners applied or conclude OSAGO agreements without examining vehicles.
Another issue is when the cost of an independent expert assessment or examination of a damaged vehicle is charged on the victim of a road accident. The Bank of Russia reminds that, by law, insurers are obliged to organise expert assessment or examination. Therefore, if, instead of assessing a damaged vehicle on its own, an insurance company sends it to an independent expert, it has to obtain a written consent of an individual to pay for these services on condition of an obligatory compensation of such expenses by the insurance company. In this case, an insured person has every right to refuse to pay for it.
The Bank of Russia draws insurers’ attention to the need of changing their business models for the sake of preventing further violations of consumer rights. Those individuals who think that their rights have been violated by insurers may in turn address their complaints to the regulator.