Guaranteed Sums in Civil Liability Motor Insurance Are Growing

The persons injured in car accidents will be protected by the insurer to even over EUR 5 million. Starting from 11 June the guaranteed sums in civil liability motor insurance will grow. This means better protection of the injured.

The guaranteed sum, being the upper limit of the liability of the civil liability insurer, now amounts in Poland to EUR 2.5 million for personal damage and EUR 500 thousand for property damage. As from 11 June the limits will grow to EUR 5 million and EUR 1 million, respectively.

In accordance with the law, if it happens that the consequences of a road accident are higher than the guaranteed sum, any costs over the insurance limits are covered by the accident’s perpetrator.
‘The changes coming into force on 11 June limit such risk to the minimum. Of course, this is the benefit mainly for the insured but also for the driver who happened to cause damage. The probability that they will need to pay for the damage from their own money will be lower than so far’, says Jan Grzegorz Prądzyński, President of PIU Management Board.

Fortunately, tragic events related to payment of indemnity worth millions happen very rarely. The major part consists of fender benders in which nobody is injured. In 2011 the average civil liability indemnity amounted to about PLN 5,000.

It is worth remembering that the guaranteed sum is only the limit of the insurer’s liability. This does not mean that payments will actually be higher. ‘It is the same as the credit card limit – higher limit does not mean that we need to spend more money’, explains Jan Grzegorz Prądzyński. For that reason, among others, it is hard to consider the very increase of the limits to be a price-generating factor. Of course, the price policy is an individual decision of each insurer, however, the growth of guaranteed sums has been known for 5 years, i.e. from June 2007. The insurers have already managed to prepare for that event.

We may not forget that on the Polish market there are at least several factors present affecting the growth of rates in civil liability insurance such as personal damage or redress costs.