Motor insurers in Algeria are aiming to resolve all appeals related to vehicle damage claims before the end of this year, according to Mr Brahim Djamel Kassali, President of the Algerian Union of Insurance and Reinsurance Companies (UAR).
The appeal cases, dating back to 2010, will be mediated upon using the “average-cost” formula, which was recently agreed upon by insurance companies. Cases earlier than 2010 have been settled, reported the Algerian Press Service.
Appeals dated 2010 were handled in January, followed by 2011 cases in February, while 2012 cases will be dealt with by the middle of the year. Claims outstanding since 2013 and 2014 will be resolved before the end of the year. There was no mention of the total number of cases in the backlog.
“We will end the suffering and litigation of the past five years, which will definitely allow us to gain credibility vis-à-vis the insured,” Mr Kassali said. Insurers, which face more than a million insurance claims each year, are overwhelmed by appeals, he said.
The problem of mounting appeal cases arise because the insurers of vehicle owners who suffer damage must wait for payment from the insurers of the party which caused the damage, before they pay their customers. The first party’s insurers often find themselves receiving payment amounts lower than the values reported by victims.
Sometimes, the accident is reported by the victim to his insurer while the insured who was at fault will have said nothing to his insurance company. Faced with such situations, victims of accidents who file appeals with their insurance companies face a delay because the insurers of the other party require a second assessment of the damage or additional documents.
In 2014, motor insurance claims paid reached DZD44.8 billion, compared to DZD40.5 billion in 2013. The amount represented 75% of the total amount of claims paid by insurers in all branches of business.
DZD10 = US$0.09