Insurers: the volume of the MTPL guarantee fund has fallen sharply

Despite the fact that insurance companies have resumed their contributions to the Compulsory Liability Insurance Guarantee Fund (OCTA) since October 2016, it has now fallen to its historically low threshold since April 2008 when it exceeded 20 million and the contributions were no longer necessary, informed the Latvian Bureau of Motor Insurers (LTAB).

According to LTAB calculations in August, its amount will be less than 17 million euros

Contributions to the Guarantee Fund are provided for by law if they fall below 20 million euros . On the other hand, if the fund falls below 17 million euros, insurers must pay double contributions.

According to LTAB, given the weak economic growth of the last decade, OCTA's average salary increase for several consecutive years, the guarantee fund fell below the 20 million mark. in 2016 and, despite contributions from insurers, its size continued to decline.

Similarly, the reduction of the size of the guarantee fund. For more than four years, the Guarantee Fund has already paid 3.41 million euros instead of the "Balva", while the total cost of the remaining fund to be paid to the insolvent insurer is 2. , 1 million euros

. the MTPL system was introduced to protect the interests of injured third parties in a traffic accident in Latvia and the Green Card Member States. In order to ensure a better functioning of the system, the LTAB has been created, which includes the insurance companies authorized to exercise OCTA insurance in Latvia – Balta, Baltic Insurance House, BTA Baltic Insurance Company, Latvia Compensa Vienna Insurance Group, ERGO Insurance Latvijas filiāle, branch of Gjensidige in Latvia, branch of Latvia in damage insurance, branch Seesam Insurance in Latvia and branch of Swedbank P & C Insurance in Latvia