Auto liability insurance facing changes

Starting January 1 2005, auto liability insurance could be valid for one year from its date of issue, instead of one calendar year or half a calendar year as until now. “We will suggest that insurance companies no longer close policies for a calendar year. We are still debating whether to go for a policy renewal at the end of the (calendar) year or to have its validity last one year from the issue date, without any renewal required, as for general insurance contracts,” Insurance Supervision Commission (CSA) sources said. The five members of the Commission Board are not of the same opinion concerning the matter at the moment; some of them are in favour of full deregulation with regard to the sale of this type of policy, while others would prefer partial deregulation. Full deregulation means that anybody purchasing an auto liability policy on, say, March 15, will be insured up to March 15 of the next year with no extra costs. Partial deregulation, on the other hand, would have these buyers renew their policies as of January 1 of the next year and agree to new insurance terms. ZF