Compulsory insurance or why do you need compulsory motor liability insurance?

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Why is so much attention paid to insurance? Why is it needed and when is it necessary to insure a car? These questions are increasingly being asked by those new to driving. It is important to understand that before you get behind the wheel, you must first take out an MTPL insurance policy. Failure to comply with the rules entails administrative liability. If you want to learn all the intricacies of how insurance works, as well as the conditions for obtaining it, then read the information provided.

Why do you need insurance?

As we have already said in the definition of compulsory motor liability insurance, this type of insurance implies compensation for material damage caused to all participants in an accident that occurred through your fault. Due to the fact that insurance is mandatory and strictly controlled by authorized bodies, this makes it possible to prevent the culprit of an accident from hiding from the scene of the accident, as well as to compensate the victims for damages, because not everyone has such a financial opportunity, and anything can be the cause of the accident. That is, the insurance company will cover all costs within the limits (up to 500,000 rubles).

Who needs car insurance

All drivers who are allowed to drive a vehicle need to be insured. If a person gets behind the wheel, then he can already become a reason for an accident and damage to other road users. Even if you do not personally own a car, this does not relieve you of responsibility. If you drive a certain car, you must be included in the insurance. Violation of the established rules may result in administrative liability. In addition, the absence of an MTPL insurance policy does not give you the opportunity to register your car.

Preparation of documents

Before preparing the documents, I would like to remind you that to purchase compulsory motor liability insurance in 2021, there is no need to have an insurance company office. Today you can buy MTPL online using your phone, computer or tablet - just go to the “Buy MTPL” section.

Registration of an electronic OSAGO policy 2021

To issue an electronic MTPL policy, you will only need the data from the documents themselves (sometimes you may be asked to provide the original documents).

1. Number and validity period of the diagnostic card.
2. Series and number, as well as the date of issue of the STS (or PTS).
3. Passport details of the policyholder and all persons authorized to drive the vehicle. If you take out “open insurance”, you will only need the passport details of the car owner.
4. Series number, as well as the date of issue of the first driver's license.

Documents for registration of compulsory motor liability insurance in an insurance company 2021

To apply for an MTPL policy you will need:

1. Diagnostic card (TO card). In 2021, due to changes in the technical inspection system, categories of motorists have appeared who can apply for compulsory motor liability insurance without undergoing maintenance.
2. STS (vehicle registration certificate) or PTS (vehicle passport).
3. Passport of the policyholder and all persons authorized to drive the vehicle.
4. Driver's licenses of all persons authorized to drive a vehicle.

Providing inaccurate information when applying for an MTPL policy is a significant reason for refusal of insurance payment. As a result, the driver receives a fine for lack of insurance and must independently pay for vehicle repairs.

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Documents for legal entities and individual entrepreneurs

In case of registration of compulsory motor liability insurance for a legal entity, the policyholder must provide the following documents:

1. Diagnostic card.
2. STS or PTS.
3. Power of attorney from the general director addressed to the applicant.
4. Extract from the Unified State Register of Legal Entities.
5. Application on the form of the insurance company.
6. Seal of a legal entity.

What is needed to apply for a policy?

If you have never taken out insurance before, then read the mandatory list of documents that you will need to present to the insurance company:

• passport;
• vehicle registration certificate;
• certificate of registration of the vehicle;
• driver's license;
• diagnostic card - the result of a vehicle inspection if it is more than 3 years old.

If the car will be driven by other people, then you will need to additionally provide their driver's licenses.

All listed documents are submitted in originals and copies. The list provided is comprehensive, regardless of which insurance company you choose to obtain insurance from. If you want to take out an insurance policy to drive a car that is owned by another person, then a power of attorney or personal presence will be required on his behalf.

Is it necessary for the owner to insure a car under compulsory motor liability insurance?

Who can insure a car or other vehicle under MTPL? Should this be done exclusively by the owner of the vehicle? Who can receive payments under compulsory motor liability insurance? What documents are required to obtain compulsory insurance?

OSAGO

Before answering these questions, you should understand who the policyholder is. This is the person who processes the insurance. It is this person who provides the necessary package of documents and concludes an agreement with the insurer.

The owner, in turn, is the owner of the car or other vehicle. Is it necessary to insure a car? Yes, the MTPL policy is mandatory. Can a person other than the owner of the vehicle take out insurance? The answer is also positive. Not only the owner of the vehicle, but also his authorized representative can contact the insurance company to conclude a contract. In order to purchase a policy, you will need to present a notarized power of attorney from the owner of the vehicle. A power of attorney can be general, special or one-time.

What documents are needed to apply for compulsory motor liability insurance? To apply for insurance, you will need to present a basic package of documents, which first of all includes the policyholder’s passport. If the registration is carried out by a trusted person, you will need the passport of this person, as well as a copy of the passport of the owner of the vehicle.

In addition, it is necessary to present the driver's licenses of all persons who are allowed to drive a particular vehicle. A vehicle passport or vehicle registration certificate is also required. For cars that require a technical inspection, the presence of a diagnostic card is also mandatory.

Documentation

The procedure for drawing up compulsory motor liability insurance by a trustee follows the same procedure as the procedure for drawing up a contract by the owner of the vehicle. The cost of the policy will not change either.

If we talk about who has the right to receive compensation in the event of an insured event, then this opportunity is assigned not only to the owner of the vehicle, but also to the insured, that is, it can be an authorized representative of the owner of the vehicle. In this case, the authorized representative will need to provide the insurance company with a complete package of documents about the accident.

Thus, it is allowed, without any restrictions, for an insurance company to draw up a compulsory motor liability insurance agreement not only directly with the owner of the vehicle, but also with his authorized representative. The same applies to receiving payments. However, in both the first and second cases, the presence of a notarized power of attorney is mandatory.

The insurer cannot refuse only because it was not the owner of the car, but a third party (if there is a notarized power of attorney) who applied for insurance or payment. If inconsistencies or errors are found in the documents, this may become a reason for refusal. Other reasons are not objective, which means they can be challenged in the manner prescribed by law.

If the owner of the vehicle is a legal entity, then insurance payments are processed by the manager or responsible person who acts by proxy.

Procedure

Today, compulsory motor liability insurance can be issued in two ways: via the Internet or in person by contacting a branch of the insurance company. Check out the features of each option and choose the one that suits you.

Online

Thanks to legislative innovations that came into force in 2015, all policyholders now have the opportunity to issue an insurance policy via the Internet. How to do it:

1. Decide with the insurance company.
2. Go to her official website.
3. Select the section – “Individuals”, “MTPL”.
4. The system will ask you to register.
5. After registration, you click “OSAGO online” and proceed to filling out the application.
6. You will be required to correctly enter the information in all the fields provided, after which the OSAGO insurance amount will appear on the screen, if it suits you, you click “Apply”.

When applying online, you will also need documents, so scan them in advance so that when you fill out the application, you can support them electronically and send them along with the application form.

Next, the application goes for verification. In a few minutes you will know the answer. If you did everything correctly, the system will offer you one of the convenient payment methods. Typically, policyholders use a bank card for these purposes. After payment, an insurance policy will be sent to your email address. To present it to the traffic police officer, all you have to do is print it out, and it can be in black and white. The electronic policy does not require any certification, since all the information necessary for it is reflected in the unified RSA database.

At the office of the insurance company

Some drivers do not trust the Internet and choose the usual way of obtaining insurance - visiting the insurance company in person. So, what will you need? First, decide on the insurance company and choose the nearest branch for yourself. At a convenient time, visit the company’s office with a full package of documents. If there is no queue, then you will be able to get compulsory motor insurance in an hour. Payment is made both in cash and non-cash form. The result of registration will be a valid insurance policy. The advantage of this option is the opportunity to first consult with the manager and ask him all your questions.

Types of insurance can be divided into:

1. Required.
2. Optional.

Unfortunately, at the moment the whole choice comes down only to the question of choosing the method of insurance. There are only two of them for 2021:

• OSAGO (Compulsory motor third party liability insurance);
• CASCO ((from Spanish casco helmet or Dutch casco body) - voluntary insurance of vehicles (cars, ships, airplanes, wagons) against damage, theft or theft).

There are quite a lot of differences in them, but there are two main ones that immediately catch your eye. Let's look at each of them in more detail separately:

• Insurance conditions;
• Cost of insurance.

OSAGO is a mandatory type of insurance for all car owners. To insure or not to insure a car is not even a question here. If you do not have MTPL insurance, a fine will be imposed. You can read in more detail about fines associated with the lack of compulsory motor liability insurance in 2021 in this article - Fine for lack of compulsory motor liability insurance in 2021.

The only advantage over CASCO is that OSAGO is cheaper and easier to buy. This article will help you figure out how to buy insurance online - What documents are needed to apply for compulsory motor liability insurance in 2021. In it you can immediately issue an MTPL policy without visiting the office of the insurance company.

However, it is worth highlighting the main disadvantages of this method of insurance. Unlike the optional type of insurance - CASCO, there are more of them:

1. The low cost of MTPL insurance will not allow you to cover all repairs in full, because... often insurance companies underestimate its cost.
2. The number of insured events covered by this insurance is less than that of the optional type of CASCO insurance.
3. In the event of a complete breakdown of the car and cannot be restored, the car owner will receive an insurance payment, but of course it will not be sufficient to purchase a new car.

It is worth noting that payment rates for compulsory motor liability insurance are determined on the basis of laws issued by the government and often may not depend on insurance companies. You can read more about this in the article - Changes to OSAGO in 2021. New tariffs.

Let's return to the question: is it necessary or not to insure a car?

Cost of insurance

How much does OSAGO cost today? The methodology for calculating the cost of a policy is the same for all companies and is fixed in law (Federal Law No. 40). Its size depends on the base rate for a particular vehicle, and what value the insurance company will take when calculating. The limits of the basic tariff are set by the Central Bank, and you cannot go beyond them. Periodically, the Central Bank changes the size of the base rate, so stay tuned for the latest information. Next, the size of the basic tariff is influenced by the personal data of each driver and his vehicle, on the basis of which the level of risk is calculated: the greater the risk of an accident, the higher the price of compulsory motor insurance.

So, the general formula for calculating insurance is as follows:

Price = BT * CT * KVS * KO * KM * KBM * KS * KN, where:

• BT – the size of the basic tariff;
• CT – coefficient for the region of registration;
• KVS – driver’s age and experience;
• KO - how many people are allowed to drive a car;
• KM – machine power;
• KBM – bonus-malus coefficient (discount for accident-free driving);
• KS – insurance period coefficient;
• KN – coefficient of violations.

For experienced drivers, the price of insurance is usually several times lower and the coefficients are lower. However, if you want to add another driver to the policy, then the calculation will be made based on the highest indicators.

How to calculate the cost

It is quite difficult to calculate the cost of insurance yourself using the above formula. For this purpose, it is better to contact the company’s office and ask an expert to calculate it or use the online calculator on the company’s website. The second option is more convenient and faster. To calculate the cost of compulsory motor liability insurance, you will need to enter data on the following points into the calculator:

• region of registration;
• type of vehicle;
• engine power;
• year of manufacture and make of the car;
• age and length of service of the driver;
• the period for which the policy is issued;
• limited or unlimited access.

After filling out all the fields, you just have to click “Calculate”. The program will automatically apply the bonus-malus coefficient (BMC) and the violation coefficient (CN) to the resulting value. Data for all drivers is stored in a single RSA database. The use of such indicators will reduce the cost of insurance or make it more expensive (if you drove your car irresponsibly in the past period).

OSAGO

How to choose an insurance company

Regardless of how you decide to get insurance - in the company’s office or online, you first need to decide on the insurance company. Today, there are a large number of insurers on the insurance market that deal with compulsory motor liability insurance. However, it is very important to choose a reliable organization that, in addition to its solvency, qualitatively fulfills its obligations to the client. So, what to look for when choosing an insurance company:

• place in the expert rating;
• how quickly insurance payments are made;
• what is the maximum amount of insurance payments;
• how long has it existed in this area;
• size of the customer base.

All these factors will determine the reliability of the insurance company, but if you want not only to be confident in the stability of the organization, but also to be comfortably served, then pay attention to the following criteria:

• insurance cost;
• where is the nearest office;
• How is customer support provided?
• special offers for new customers and additional discounts.

Among other things, study reviews from regular customers about the work of the selected insurance company. Very often, people indicate the main complaints that force them to subsequently change their service company. It’s good if this is the opinion of your friends. If there are none, then it is best to turn to forums or groups on social networks, since not all written reviews on the Internet are reliable, especially those presented on the company’s website.