On December 27, Shanghai Insurance Exchange officially launched the new energy vehicle insurance trading platform, and the first batch of new energy vehicle exclusive insurance products of 12 property insurance companies including PICC Property Insurance, Ping An Property Insurance and CPIC property insurance were listed.
Industry insiders believe that the listing of new energy exclusive auto insurance will bring new opportunities to auto insurance and help insurance enterprises to achieve accurate pricing. It is worth mentioning that the 21st Century Business Herald reporter found that the “model price of 250000” of new energy exclusive auto insurance has become a watershed for premium floating.
“3 main insurance + 13 additional insurance”
At 0:00 on December 27, 2021, The People’S Insurance Company (Group) Of China Limited(601319) successfully signed the new energy vehicle insurance policy, becoming one of the first companies in the industry to use the new terms to underwrite the new energy vehicle insurance business.
On December 14, the China Insurance Association officially issued the exclusive provisions for commercial insurance of new energy vehicles of China Insurance Industry Association (for Trial Implementation) (hereinafter referred to as the “provisions”).
The terms provide guarantee for the “three electricity” system (battery, motor and electronic control of electric vehicles), and comprehensively cover the use scenarios of driving, parking, charging and operation of new energy vehicles. The release of the terms fills the gap in the specification of new energy vehicle insurance, and brings the concerned risks such as battery, spontaneous combustion and charging into the protection.
With the release of the terms, many insurance companies launched new energy exclusive auto insurance today. 21st Century Business Herald reporter summarized a number of new energy exclusive Auto Insurance Listed today and found that the exclusive auto insurance mainly added two parts of terms.
First, it is clear that the three electricity system (battery, electromechanical and electronic control) belongs to the insurance liability of vehicle damage insurance, and comprehensively covers the scenes of driving, parking, charging and operation at the use level.
Second, for the unique risks of new energy vehicles, additional risk guarantees such as loss of self-use charging pile and failure loss of external power grid are added.
The specific terms include “3 main insurances + 13 additional insurances”, which can cover the liability for direct loss of all equipment leaving the factory, such as vehicle body, battery and energy storage system, motor and drive system and other control systems, caused by natural disasters and accidents (including fire and combustion); Vehicle loss caused by external power grid failure; Third party liability for self use charging pile’s own loss and self use charging pile.
It is worth noting that the commercial auto insurance terms are launched this time, and the traffic compulsory insurance has not changed. The models that can be insured include plug-in hybrid (including incremental) vehicles, pure electric vehicles and fuel cell vehicles.
how many families are happy about the increase or decrease of premium? How many families are worried about 250000? It’s a “watershed”
For consumers, what they are most concerned about is the increase or decrease of premium.
It may be noted that the model provision includes an increase in the depreciation rate. Compared with the 0.6% depreciation rate of traditional auto insurance, according to the fuel type, the depreciation rate of new energy auto insurance is divided into pure electric vehicles, plug-in hybrid vehicles and fuel cell vehicles.
Among them, the depreciation of pure electric vehicles is significantly higher than that of other models, and the lower the price, the faster the depreciation. The faster depreciation means that the insured amount will decline faster and the compensation for total loss will be less. In order to ensure that the insured amount can cover the risk, the rate is likely to increase.
Earlier, the China Association of Actuaries released the benchmark pure risk premium table of new energy vehicle commercial insurance, which showed that the benchmark premium was basically flat. According to the premium calculation formula, the benchmark premium = benchmark pure risk premium / (1-additional fee rate), the additional fee rate of new energy vehicle insurance decreased from 25% to 15% of traditional fuel vehicles, and the benchmark premium decreased slightly compared with the current comprehensive reform, with the overall decline of three risks and vehicle damage insurance by 0.8%, which was higher than the calculation results of the previous round (the decline of 6.2% in the previous round of test), The proportion of overall premium rising policies increased from 18.3% in the last round of test to 20.7%, close to 80%, and the benchmark premium of policies decreased.
Total premium of auto insurance = benchmark premium * no compensation preferential treatment coefficient * traffic violation coefficient * independent pricing coefficient. Relevant insiders believe that the independent pricing coefficient (0.65-1.35) is the key to the pricing difference.
Although the benchmark premium of 80% of insurance policies has decreased, the implementation to consumers depends on the last three coefficients of the premium formula.
“The premium of some models has decreased, and the premium of most electric vehicles with a price of more than 250000 has increased compared with the previous price.” PICC auto insurance housekeeper Xiao Fan told the 21st Century Business Herald reporter.
At China Pacific Insurance (Group) Co.Ltd(601601) 250000, it has also become a “watershed”, “the three liability insurance is consistent with the current rate framework, and the relative difference rate between water levels in all dimensions remains unchanged, and the change range of various vehicle types is also small. The vehicle damage insurance is close to the three liability insurance framework. In the calculation, the affordability of price sensitive stock new energy vehicle owners is specially considered, and the vehicle price below 250000 yuan is limited.” China Pacific Insurance (Group) Co.Ltd(601601) indicates.
The increase of the rate is mainly due to the risk probability and compensation of new energy vehicles. The existing new energy vehicles have a high risk level, so the rate will be correspondingly high. Relevant industry insiders believe that even if the difference between the purchase price and the subsidy price is cancelled in the future, the price probability of new energy vehicle insurance will still be higher than that of fuel vehicles of the same grade. Coupled with additional insurance such as charging piles, the price should not decline too fast in the short term.
In fact, because the accident frequency and loss ratio of new energy vehicles are higher than those of traditional fuel vehicles, and the products of traditional models are used, the insurance companies are generally not willing to underwrite, which is not conducive to the long-term development of the auto insurance industry in the long run.
The cost structure of new energy vehicles is very different from that of traditional fuel vehicles, so there are great changes in the risk structure and risk cost of new energy vehicles. The core power system of new energy vehicles is composed of battery, motor and electronic control, which replaces the engine, gearbox and other devices of fuel vehicles. Therefore, the protection of vehicle core components in traditional vehicle insurance is not suitable for new energy vehicles; In addition, the scope of liability in the traditional auto insurance terms cannot cover the specific risk factors faced by new energy vehicles, including battery failure, charging failure liability, etc., so it will be difficult for new energy owners to claim after the risk occurs.
Airy consulting believes that under the background of fierce stock competition and meager operating profit in the current auto insurance industry, new energy exclusive auto insurance has undoubtedly opened a new incremental market. For insurance companies, new energy exclusive auto insurance helps to make more accurate pricing, so as to alleviate the pressure of compensation and improve operating profits; For consumers, new energy exclusive auto insurance fills the pain point of insufficient protection of traditional auto insurance, helps to eliminate consumers’ doubts about car purchase and improve consumers’ car experience.
China Pacific Insurance (Group) Co.Ltd(601601) said that before the launch of new energy exclusive vehicle insurance, the underwriting and claim settlement of new energy vehicles and fuel vehicles lacked rules and practices of fine management, the precipitation of insurance experience data was not sufficient, and the accident rate and compensation rate of new energy vehicles were still significantly higher than that of traditional fuel vehicles in the short term. However, with the practice and accumulation of exclusive products in the expanding market, the claim settlement technology will be rapidly iterated and upgraded, and the practice of fine management of underwriting pricing will promote the return of the loss ratio of new energy vehicles to a reasonable level in the long term.
(21st Century Business Herald)
