The price of the MTPL policy depends not only on the vehicle’s power, driving experience, age and place of residence of the driver, but also on how carefully he behaves on the road. Car owners who do not get into an accident (at least through their own fault) can expect up to 50% discount on compulsory motor liability insurance. But those who are often to blame for accidents will pay 2.5 times more for insurance. How much a discount or allowance will amount to depends on the bonus-malus coefficient (KBM). So, what are the rules for calculating MSC?
Discount or fine?
The KBM is otherwise called the accident-free driving discount. If the driver over the past year has never become the culprit of an accident, then the insurance company did not have to spend money on paying compensation. For this, the client can be encouraged and next year to sell him insurance at a discount - to provide a bonus.
If the driver had an accident, then the insurer had to fork out for payments. And in order to compensate for its costs and at the same time stimulate the unfortunate driver to be more attentive on the road, the insurance company, by renewing the policy, will increase the price of OSAGO - it will provide a malus.
What accidents are taken into account?
To begin with, we note that not every accident affects the calculation of the MSC. MTPL is liability insurance, not property insurance . Therefore, the calculation takes into account only those accidents in which the insurer had to make an insurance payment for his client.
If the driver is not to blame for the accident, or the accident was not filed with the traffic police, or the issue was settled according to the Euro protocol, this does not threaten the car owner with an increase in the cost of compulsory motor liability insurance.
Bonus malus odds table
To determine the coefficient, such a table of calculation of the KBM is used.
Allowances and discounts | Bonus Malus Ratio | Source class | New class |
0 fear. payouts | 1 fear. pay | 2 fear. payouts | 3 fear. payouts | 4 and more insurance payments |
145% | 2.45 | M | 0 | M | M | M | M |
130% | 2,3 | 0 | 1 | M | M | M | M |
55% | 1.55 | 1st | 2 | M | M | M | M |
40% | 1.4 | 2nd | 3 | 1 | M | M | M |
100% | 1 | 3rd | 4 | 1 | M | M | M |
-5% | 0.95 | 4th | 5 | 2 | 1 | M | M |
-10% | 0.9 | 5th | 6 | 3 | 1 | M | M |
-fifteen% | 0.85 | 6th | 7 | 4 | 2 | M | M |
-20% | 0.8 | 7th | 8 | 4 | 2 | M | M |
-25% | 0.75 | 8th | 9 | 5 | 2 | M | M |
-thirty% | 0.7 | 9th | 10 | 5 | 2 | 1 | M |
-35% | 0.65 | 10th | eleven | 6 | 3 | 1 | M |
-40% | 0.6 | 11th | 12 | 6 | 3 | 1 | M |
-45% | 0.55 | 12th | thirteen | 6 | 3 | 1 | M |
The first two columns indicate the class at the beginning of insurance and the corresponding coefficient. The remaining columns of the table allow you to determine how the class and MSC will change in the presence or absence of accidents.
The column names show the number of cases in the past period in which compensation was paid. Accordingly, the first column with the number 0 means that there were no accidents, and the fifth, with the number 4+, indicates that the person had an accident more than four times. The numbers and letters in the body of the table show how the OSAGO class changes depending on the number of incidents on the road due to its fault.
Calculation of KBM is performed according to the following principle. The unit is subtracted from the value of the coefficient, and the result is multiplied by 100%. When a person first acquires compulsory motor third-party liability insurance, they automatically receive 3rd class with KBM 1. Such a driver pays 100% of the cost of insurance - without any discounts or extra charges.
If the KBM is determined at the level of 0.9, then it turns out: (0.9 - 1) * 100% = -10%. This means that the driver is entitled to a 10% discount.
If the coefficient is 2.45, then: (2.45 - 1) * 100% = 145%. The cost of the policy increases by 145%, that is, the car owner pays 2.45 times more for insurance. This is the punishment for creating road accidents.
How to determine the coefficient from the table?
Before calculating the KBM, or rather, discounts or premiums in accordance with the insurance history, you need to determine the driver class in order to know which coefficient to apply.
Suppose a car owner recently got a license, bought a car and came to arrange for motor third party liability insurance. He is assigned the standard 3rd grade. A year passed, and he came to extend insurance. The employee looks at the insurance history and finds out that last year the accident passed the client.
The table shows that in the absence of an accident after the expiration of the annual insurance period, the driver goes into the 4th class, and his coefficient decreases from 1 to 0.95. When renewing the contract, the car owner can pay for insurance with a 5% discount. The next time the MTPL is issued, the insurer will already be guided by the line of the table corresponding to the 4th class.
If it turns out that during this time one accident occurred due to the fault of the driver, then his class will change from 3rd to 1st, and KBM will grow from 1 to 1.55. For new year insurance you will have to pay 55% more. Further, the calculation of the KBM will be based on the line corresponding to the 2nd class. Only two years later, a person will be able to return to 3rd grade and start earning a discount.
If the driver falls into class M, he will need as much as five years to again reach the standard 3rd class.
If several people are included in the policy, then the discount or allowance are determined by the worst of the coefficients.
How to find out your ratio?
It is extremely rare for KBM to be indicated on the insurance policy. Therefore, in order to determine your class in compulsory motor third-party liability insurance and, accordingly, the size of the discount or allowance, you will have to contact the insurer, calculate KBM yourself using the table, or use the PCA database.
When requesting a driving class, the insurance company must provide a certificate in form No. 4 with all necessary information within five days. This document is useful if the car owner plans to change the insurer.
To find out the coefficient on the PCA website, go to the “CTP” section and click on the “Information for Policyholders and Victims” tab. Among other information services, you will find a coefficient determination. To obtain information, just enter the name and number of the driver’s license in the form that opens.
So we learned what KBM is, why it is needed, and how to calculate it.