Sayenko Kharenko’s antitrust team has provided legal assistance to secure Antimonopoly Committee of Ukraine (the “AMC“) clearance for the introduction of a new direct claims settlement agreement between the Motor (Transport) Insurance Bureau of Ukraine (MTIBU) and insurer members of the MTIBU.
The agreement introducesa new system for claims settlement. This system allows the affected person to apply for the settlement of claims to their specific insurer, which is subject to the executed compulsory motor vehicle liability insurance agreement. As a result of the adoption of this new system, the potentially affected person will now be able to choose an insurer in advance according to the required criteria, and will have assurances that when any insurance-related event occurs, timely compensation will be guaranteed. On the other hand, the insurer will be motivated to provide high-quality services by offering full coverage and settling client claims in a timely manner based on the terms of contractual relations between them. The insurers will be encouraged to compete not only by price, but also in terms of the quality of their services.
Similar direct claims settlement systems successfully operate in many developed insurance markets such as: France, Belgium, Italy, and other European countries. The system developed by MTIBU is based on advanced European experience and aims to develop the domestic market of motor vehicle liability insurance in line with the best international practices and standards.
The agreement was signed by 18 insurance companies that are members of MTIBU: “AXA Insurance”, “ARSENAL INSURANCE”, “PZU Ukraine”, “VUSO” “UASK ASKA”, “ORANTA”, “PROSTO-strahuvannya,” “UNIQA”, “PROVIDNA”, “INGO Ukraine”, “Universalna”, “International Insurance Company”, “CREDO”, “ASKO-Donbass Pivnichnyi”, “Kolonneyd Ukraine”, “BROKBUSINESS”, “IC KRAYINA”. On 1 February 2017,IC “European Insurance Alliance” also signed up to the agreement.
The AMC granted approval for concerted practices on 27 October 2016 for a two-year term. The corresponding decision of the AMC was granted after a thorough investigation of the impact of the proposed concerted practices on the market of motor vehicle liability insurance services in accordance with the law on the protection of economic competition, and after consideration of the anticipated favourable impact of these direct claim settlement practices on the market.