The Moroccan Federation of Insurance and Reinsurance Companies (FMSAR) has announced that insurers will offer discounts that can reach 30% of premiums on annual motor third party liability insurance policies as well as additional coverage for two months of a coronavirus lockdown.
The discount to be offered could cost insurers a total of more than MAD500m ($50.8m), according to the FMSAR.
The discount is because of an exceptional adjustment made due to a decline in the loss experience during the lockdown period, says the Federation in a media release. The discount is offered on top of a set of other measures taken by insurance companies to ease the daily lives of customers and reduce their financial burden in the face of difficulties caused by the COVID-19 pandemic.
Although the impact of the fall in claims can only be assessed at the end of the current financial year, FMSAR members have decided to anticipate the decrease and allow policyholders to obtain some benefits earlier, regardless of the nature and category of their vehicles.
The premium discount will be granted when a motor policy is renewed during the period between 1 June 2020 and 31 May 2021 on the sole condition that the vehicle is insured during the lockdown period.
In the current difficult times, other measures which insurers in Morocco have taken to help policyholders and insurance intermediaries include:
the assumption of the interest expense on loans granted by banks to auto-entrepreneurs;
the extension of the validity of motor insurance policies that expired between 20 March and 30 April 2020 to allow policyholders to renew them by 30 April;
providing health insurance cover to policyholders who incurred COVID-19 related medical treatment expenses, even though pandemics are excluded under insurance contracts;
providing work accident insurance cover to those who engage in teleworking, excluding household accidents;
the activation of credit lines, at interest rates subsidised by insurance companies, for the benefit of insurance brokers and general agents to help them cope with funding the equivalent of three months of general expenses.
The coronavirus lockdown imposed by the authorities has resulted in lower claim volumes because of fewer traffic accidents, while work stoppages and teleworking have led to fewer work accidents.