Crisis: Greece's auto insurance market takes a plunge

21 November, 11:03

    (ANSAmed) - ATHENS, NOVEMBER 21 - The price war in car insurance premiums in Greece is behind the dramatic drop in the sector's turnover, which declined by 15.2% last year compared to 2011 and another 6.5% on a yearly basis in the first nine months of this year, as daily Kathimerini reports quoting a survey on the sector issued by the Hellenic Association of Insurance Companies. A glance at the report's data confirms that the decline is not due to the reduction in the number of vehicles insured, but rather the fierce competition between companies, which has led to a slide in premiums. In fact, it appears that the drop in prices has led to an increase in the number of cars insured. At the end of October the number of insured vehicles stood at 5.7 million, up from 5.3 million in December 2012.

    Besides the fact that the drop in premiums has made insurance more attractive to those who had been reluctant to comply with the law's provision for the obligatory insurance of vehicles, the fear of being fined for not doing so, as dictated by a recent law which has yet to be activated, has also resulted in an increase in the number of cars insured. However, there are still about 1 million cars without insurance. The study also points to a considerable decline in the number of companies operating in the sector as, after a number of closures, car insurance firms have dropped from 48 in 2008 to just 31 last year. (ANSAmed).

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