Insurance, direct compensation damages two wheels

Insurance – 56 million euros in extra costs. This is the financial burden that, in the last two years, has been borne by insurance companies, as a result of direct compensation: costs that are automatically passed on to end customers.

Since 2007, in fact, the driver who suffers an accident is no longer compensated by the responsible company, but by his own; the latter then receives a reimbursement from the insurance of the driver who caused the accident. However, the responsible party's insurance does not pay the injured party's company the exact amount that the injured party received from their insurance, but rather a lump sum reimbursement, the amount of which is defined year by year. Starting from these premises, Confindustria ANCMA commissioned the LUISS Guido Carli University of Rome to carry out a scientific study of direct compensation, with the aim of verifying its distorting effects on moped and motorcycle policies.

The study was based, among other things, on data provided exclusively by the insurance services concessionaire CONSAP and made use of an original mathematical model, specifically developed by the LUISS team. Some important results emerged from the research.

1. The direct compensation mechanism - which as a whole has generated positive effects on the rates and timing of compensation - produces clear distorting effects when the accident involves vehicles belonging to different categories.
2. Since, in the majority of cases, motorcycle accidents involve vehicles belonging to other categories (mainly cars), the two-wheel sector is penalised, with a consequent increase in insurance rates: the CONSAP data - as mentioned - highlight that the Motorcycle accidents, in the last two years, have cost companies 56 million euros more than the costs they would have generated in the absence of the direct compensation system.
3. Direct compensation is an unfair system because it passes on the costs generated by insureds of other categories to the insured motorcyclists
4. The only way to eliminate the distorting effect described above at its root is to eliminate or reform the lump sum mechanism, or, more radically, eliminate the entire system of direct compensation

In Italy the cost of a policy is on average 86% higher than the rates in the main European countries and corresponds to 56% of the cost of running the vehicle; affects, on average, up to 50% of the purchase price of a scooter. Furthermore, geographical segmentation is still very serious: insuring a motorcycle in Campania costs three times as much as in Friuli Venezia Giulia.