BAKU, Azerbaijan, November 4. The Central Bank of Azerbaijan has developed a new approach, law and mechanisms for regulation and management on OSAGO policy (compulsory auto third party liability insurance), Director of the Insurance Activity Policy and Supervision Department of the Central Bank of Azerbaijan (CBA) Vusal Gurbanov told Trend.
"If a driver manages his vehicle without accidents, the bonuses (discounts) are applied for subsequent insurance, and if an insured event occurs, then a malus is applied, that is, the cost of insurance will be higher. This system currently works in real time, that is, when an insured event occurs, a malus is immediately applied to the guilty person. In addition, in areas where traffic is heavy, more stringent measures were applied on the malus system. All this work was carried out in order to minimize damage to third parties and ensure safety movement of vehicles," Gurbanov said.
He stressed that traditionally cars are considered risky vehicles for insurance companies, while the age and driver experience of persons create additional risks.
"Other factors that can lead to an insured event is the age of the car and the management of one car by several persons," Gurbanov added.