Can an insurance company refuse to enter into an MTPL agreement?

Why does the insurance company refuse to insure your car?

Many car owners have encountered a situation where the insurer, under various pretexts, refused to enter into an MTPL agreement with them. All reasons for refusal can be divided into two groups - legal and illegal. If a driver is refused to issue a policy for a clearly far-fetched reason, he has the right to file a complaint against this organization with the supervisory authorities.

The most common reasons for refusal are:

• The link is not a technical problem - lack of connection with the SAR database, failures in the computer program, etc. The real reason here usually lies in the firm's attempts to optimize the costs of paying insurance compensation.
• Imposing additional paid services. This is considered a direct violation of Federal Law No. 2300-1 “On the Protection of Consumer Rights,” but some companies deliberately do this.
• Insufficient number of policies. This happens if a branch receives a limited number of policies due to low turnover.
• Revocation of the insurer's state license. Without this, the company has no right to enter into transactions with clients.
• The client provides an incomplete set of documentation, or the submitted papers contain some errors and inaccuracies.

If the car owner believes that he was denied a contract illegally , he can file a claim against this insurance company.

How to force an insurance company to issue compulsory motor liability insurance?

A car owner whose insurance representatives refuse to issue an MTPL policy must:

1. In the presence of witnesses, request a company representative to formalize the refusal. The insurer must justify in writing the reasons that became the basis for such a decision.
2. Try to obtain compulsory motor liability insurance from another company that provides civil liability insurance services. If here, too, the car owner is shown the door, he must in any case demand a reasoned written refusal.
3. Knowing that the actions of insurance employees are illegal, you need to refer to the provisions of the Law “On Compulsory Motor Liability Insurance” (Part 1 of Article 4 No. 40-FZ of April 24, 2002) and paragraph 2 of Article 16 of the Federal Law of the Russian Federation 2300-1 “On the Protection of Consumer Rights " You can also call the head of the department - if the insurance company employees see that their visitor is legally savvy, then most often they will agree to resolve the issue in favor of the client.
4. Record on video (as mentioned above) all the actions of a company employee who does not want to issue a form or give a written refusal. Gather witnesses and also record their testimony on a video camera or mobile phone.
5. Warn the insurance company employee about liability for violating the law, remind him of the administrative liability of officials who commit such offenses.

In most cases, this tactic works, and insurers satisfy the application of the vehicle owner. When, nevertheless, the client is refused to issue an MTPL policy, and still manages to obtain a refusal in writing (as practice shows, this is very difficult to do - almost always the result is close to zero), this document can be the basis for filing a claim against this insurance company.

How to file a complaint against an insurance company

Art. No. 426 of the Civil Code of the Russian Federation indicates that every citizen has the right to independently choose where to purchase an MTPL policy. After submitting a complete set of necessary papers, insurance agency employees are required to conclude an insurance agreement with the car owner. The policy is issued on the day of application; in exceptional situations, the company is given three days for this.

In case of illegal denial of service, there are two options:

1. Contact another insurance company.
2. Seek to conclude an agreement with this insurer.

Expert opinion
Maria Mirnaya

Insurance expert

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In the second case, the law provides car owners with the opportunity to file a complaint with supervisory authorities. If the insurer refuses to insure under compulsory motor liability insurance, the first step is to file a claim with the management of the organization whose employees violate the current legislation. This can be done during a personal visit to the organization’s head office, by sending a complaint by registered mail, or through the insurer’s website.

If this does not lead to a positive result, the client needs to contact the regulatory authorities. This:

• RSA.
• Regional branch of the Central Bank.
• Prosecutor's office.
• Judicial authorities.
• Antimonopoly Service.

The complaint is made in free form, but with the obligatory indication of the data of the applicant, the violating company and a description of the circumstances of the problem that arose.

A sample application can be downloaded from this link.

Procedure for filing a claim in case of refusal to take out a policy

If it is impossible to obtain a policy, the car owner can file a claim with the insurance company using one of the following methods:

1. Take the offer application in person to the agency office.
2. Send an application via Russian Post.

An application submitted in person must be made in two copies. One of them remains with the insurance company, the second with the recipient’s signature, seal and date of acceptance must remain in the hands of the policyholder. It must be registered and assigned an incoming number, which is also indicated on the second copy.

The letter must be sent by registered mail with acknowledgment of receipt. In accordance with the law, the MTPL agreement is public, therefore the client’s written request must be considered without fail. In response to this request, the insurer must send a written refusal or a signed contract.

What documents need to be attached

Along with the completed claim, the applicant will need to attach certain documents.

1. A copy of the applicant's passport to confirm his identity.
2. A certified second copy of the claim submitted to the insurance company.
3. Evidence confirming the fact of violation by the insurer of legal norms. This is a paper with an official refusal, photos and audio-video recordings, testimony of witnesses.

After receiving an application from the consumer, supervisory authorities order an inspection based on the facts stated in it. If it turns out that the refusal of compulsory motor insurance was illegal, the regulatory authorities issue a notice demanding that the violations be corrected.

Filing a complaint against an insurer

If agency employees persistently refuse to provide a compulsory motor liability insurance policy, then their unlawful actions should be challenged.

For this purpose, the following documents are pre-prepared:

• an application from the driver in which he applies to the organization for the provision of an MTPL policy, signed and stamped;
• refusal of the insurance company to provide the policy in writing (if any);
• testimony of witnesses, which can be collected both in writing and using audio and video recordings.

Once the driver has all these documents in hand, he can send them to the following competent authorities:

• to the regional branch of the Central Bank of Russia;
• to the court at the place of registration;
• to the prosecutor's office at the place of registration;
• to the nearest branch of the RSA or FAS.

If you intend to defend your interests through authorized bodies, you should notify an employee of the organization about this; in some cases, such actions lead to a positive result.
Insurance companies refuse to insure a car under MTPL, what should I do? In this case, you can immediately contact the court or the prosecutor’s office; as a rule, these authorities will quickly put the dishonest agency in its place and issue a policy to the driver.

Additionally, it should be noted that the claimant in this case has no chance of anything beyond the free registration of the policy, since the authorities themselves will conduct an investigation and punish the organization to the fullest extent of the current legislation.

Additionally, the insurance company will be charged a large fine.

What to do if there is no time to challenge the refusal

Consideration of the submitted application may take a long time. So, in courts this can take up to several months, depending on the judge’s workload. Therefore, in order to avoid lengthy litigation, you can simply apply for insurance from another organization, or apply for UISAGO via the Internet. When the insurer, as a condition of concluding a contract, makes a requirement to purchase an additional product, the client can use a little trick. He agrees to this condition, but within 5 days refuses additional services and takes back the money paid for them. This is allowed by Federal Law No. 2300-1.

Special provision of additional services

There are often cases when a refusal to issue an MTPL policy is associated with an additional offer of options that the vehicle owner refuses due to uselessness.
Organizations specifically impose additional options on their clients, thereby significantly increasing the cost of the form; this allows the insurer to at least somehow cover its losses and make a profit from the sale of the MTPL policy. And only if the car owner agrees to be persuaded by the insurance company’s employees to purchase any unnecessary options, a policy is issued. Similar phenomena are currently widespread in all regions of Russia.

It is worth noting that in accordance with the law on the protection of consumer rights, the policyholder who purchases a compulsory motor vehicle policy is not obliged to make concessions to the insurance agency and purchase additional options that are completely unnecessary for him.

If without this he is denied the form, then he has every legal basis to file a lawsuit against the organization and defend his rights in a judicial body.

If the client’s requirements for issuing a compulsory motor liability insurance policy are not met, it is mandatory that the organization’s employees record the reason in writing, which will allow them to obtain legal grounds for filing a claim in court. Additionally, the motorist can record the fact that he is denied a policy using an audio recording or video recording. In the last two cases, in order for the court to take into account the evidence, you should warn the company employee that you are video or audio recording the entire conversation. Additionally, in favor of a motorist who has received a refusal, the testimony of witnesses who were present in the organization at the time of the attempt to draw up the document may come forward. All this will help you defend your rights in the courts and hold the insurer accountable for unlawful actions.

It is worth noting that in the case where the insurance company representative was not notified of the video or audio recording of the conversation, then in court this evidence will not be regarded as evidence.

When is refusal legal?

In some situations, the possibility of refusal to issue compulsory motor liability insurance is provided for by law. The company has full grounds to refuse to provide insurance in the following cases:

• Lack of connection with the AIS system, which does not allow calculations of the policy price.
• Refusal of the car owner to provide the car to assess its technical condition.
• Incomplete set of papers submitted by the policyholder.
• The policyholder who is not the owner of the vehicle does not have a notarized power of attorney from the owner of the car.

In all other cases, refusal to insure a vehicle is regarded as illegal .

Possible reasons why the insurance company refuses

Vehicle insurance is regulated by Federal Law No. 40 of April 25, 2002 (latest edition) “On compulsory civil liability insurance of vehicle owners.” Currently, there are more and more cases when a driver is refused by an insurance company to enter into a compulsory motor liability insurance contract, and this problem has already affected many regions of Russia. Most often, this situation occurs for the reason that it is extremely unprofitable for insurance companies to provide policies, since this is a rather unprofitable segment, especially considering the fact that the number of accidents on Russian roads is increasing every day. Even the recent tariff increase still had no effect on this situation. According to insurance organizations, the provision of a policy and subsequent repairs at the expense of the organization are incommensurable values.

Let's look at the main reasons why drivers can often face refusal:

• the limit on insurance payments was increased to 400 thousand rubles;
• a unified calculation system was introduced to calculate losses received;
• in addition, the law on the protection of consumer rights extends to the motor vehicle;
• Most imported spare parts for vehicles have become more expensive, which has led to an increase in compensation payments.

Due to the fact that the provision of MTPL policies is extremely unprofitable for insurance companies, many organizations have completely abandoned this type of insurance, and some even had to close due to bankruptcy.