Insurance has become worthless. The experts explained why

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Many insurers today offer their customers to increase insurance coverage for an additional fee by re-issuing comprehensive insurance policies.

In addition, the offer applies to credit and lease cars – a week and a half ago, insurers did not yet take such a risk.

The death of a car to repair


The logic of the insurers is clear – the hull insurance takes into account the cost of the car at the time of purchase of the policy. The payment is calculated from this price in the event of an insured event.

In March, many cars have increased in price by 20-30% and the cost of many car parts has almost doubled. And it can be assumed that the payment under the hull policy purchased in February and even early March 2022 will not cover the real repair costs. And if you are compensated for a minor damage, then in a major accident it is simply unprofitable for the insurance company to repair your car.

Tatyana Vilchevskaya, head of the advertising and marketing department of the insurance company Energogarant

Tatyana Vilchevskaya, head of the advertising and marketing department of the insurance company Energogarant

Expert Commentary

“Car owners who bought and insured their car before the crisis for an amount that was quite sufficient for that time (say 1 million rubles), today in the event of an accident, an unpleasant surprise awaits. Indeed, in a car service, they will conduct an investigation and calculate the cost of repair, taking into account the increase in price of both components and the cost of the work. And if the replacement cost of the repair exceeds 70% of the insured amount (for example, 750 thousand rubles in our case), the insurance company has the right to recognize the full structural loss of the car. So the only workable way to protect yourself is to extend your insurance coverage to the true value of your car today.”

Is Total profitable?


In case of acknowledgment of the constructive loss of the car, the owner can receive the full insured amount and the usable remains (everything left of the car) is transferred to the insurance company.

It is also possible that the good assets are transferred to the owner – in this case the value of the good assets will be deducted from the insured amount. But neither option will make up for your financial losses.

In the event of theft, it is also important to take out comprehensive insurance for the amount that corresponds to the current market value of the car. Otherwise, the money paid is simply not enough to buy a new car.

Are insurance prices going up?


Since the beginning of March, due to the instability of the ruble, the rise in prices for spare parts and repairs, the average cost of comprehensive insurance has increased by 15-20%. Many insurers assume that this is not the limit – after all, the cost of components and repairs continues to rise.

However, insurers are seeing an increasing demand for comprehensive insurance. For example, according to insurance company Energogarant, the number of insured cars increased by 16% in March 2022 compared to February 2022. Car owners anticipating an increase in the number of thefts try to protect their car with insurance. Many of them emphasize that they cannot afford to buy a new car.

What should car owners do? (advice from insurers)

  1. Be careful, follow the traffic rules, try not to have an accident.
  2. Store vehicles in secure areas and garages.
  3. Study the offers of different insurers carefully: some insurance companies recognize damage above 75% of the insured value as a total loss of a car, some have set a threshold of 70, 65 and even 60%.
  4. If possible, check the insured amount and renegotiate the contract with the insurance company, so that in the event of theft or constructive loss of the car, the amount of compensation is increased to appropriate new prices.
  5. If you have a limited budget, you will pay for insurance with a deductible. This method saves on comprehensive insurance and at the same time protects the car in the event of an accident and theft. In addition, many insurance companies accept insurance payments in installments (you can split the cost into four equal payments).
  6. If you disagree with the insurance company’s decision, go to court. You can contest the decision of the insurer as well as the investigation and calculation by the gas station. The judgment is binding on the defendant or plaintiff.

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