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Motor vehicle insurance will be significantly more expensive in 2024 - GDV President warns
Drivers in Germany will have to pay higher car insurance premiums as repair costs rise. Flood damage totals 200 million euros. Experts warn of further price increases. #Car insurance #Flood damage #Insurance #Germany #Increase in costs
Motor vehicle insurance will be significantly more expensive in 2024 - GDV President warns
Drivers in Germany should prepare for the fact that the costs of vehicle insurance are likely to rise in the coming year. According to Norbert Rollinger, President of the German insurer association GDV, premiums in this segment could increase by an average of ten percent as early as 2024. This increase would be a response to the increased prices for repairs and spare parts last year, which caused heavy financial losses to motor vehicle insurers.
The forecast for 2024 suggests that the costs of spare parts and repairs will continue to increase. Last year there was already a significant increase in spending on claims, administration and sales in the motor insurance industry. According to Rollinger, expenses exceeded income by 2.9 billion euros, which corresponds to a loss of 1.10 euros for every euro collected.
In addition, the losses in the motor vehicle business also impacted the result of the entire property and casualty insurance, with the underwriting profit falling by more than half. In view of this development, it is expected that premiums for building insurance will also increase by an average of around ten percent. Another factor that is putting a strain on the insurance industry is the flood damage in Germany, the insured loss of which is estimated at around 200 million euros.
The low prevalence of natural hazard insurance means that the total damage caused by flooding is significantly higher than the insured amounts. The GDV criticized the precautionary deficits of the states and municipalities as well as the lack of adaptation of dams and dikes to the consequences of climate change. Despite these challenges, insurers reject mandatory natural hazard coverage for homeowners, but are calling for measures such as a halt to construction in flood areas and a nationwide natural hazards portal.
Overall, the GDV is optimistic for the current year and predicts an increase in premium income in the insurance industry. The property and casualty business is expected to be the driving force, with an increase of 7.7 percent.