Motor insurance premiums may (significantly) rise in Mozambique

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Motor insurance premiums may (significantly) rise in Mozambique

12:25 CAT | 03 Oct 2017

O País (File photo) / Government intends to increase minimum motor insurance premium from 300,000 to 3 million meticais

The Government wants to raise from 300,000 to 3 million meticais the minimum capital of the car insurance premium [ from around US$4.887 to US$48.874 at current exchange rates]. The executive says that the current value is out of line with the current costs of maintenance in cases of claims, a factor coupled with changes in the exchange rate.

The current minimum insurance value – on the basis of which the repair or replacement of a vehicle in the event of an accident is estimated – was established by the Government in 2005.

Twelve years later, the executive believes that there have been many changes in maintenance costs, so it plans to increase the minimum capital to three million meticais.

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The increase of the capital should consequently increase the value of the annual instalment paid by the insured.

According to lawyer Rodrigo Rocha, this measure could guarantee greater security to the insured, who are often forced to contribute to vehicle repairing because often the premiums are not enough to cover the costs.

The decision needs to be published in a ministerial decree signed by the Minister of Economy and Finance.

Source: O País