Bonus-Malus… sounds like a Harry Potter spell. But do you really know what it is? The bonus-malus class is an important part of the Mandatory Third-Party Motor Vehicle Liability (MTPL) system in Latvia. It provides an objective assessment of insurance risk and influences the calculation of the MTPL policy price and has been in operation since 2006. In order to understand the principles of the Bonus-Malus system, it is important to know the following things:
- What is a Bonus-Malus system? It is a common method that allows evaluating higher- and lower-risk drivers and objectively determining the prices of MTPL policies. This process considers the number of road traffic accidents caused by a person and the number of insurance days in a given period. All system participants are gathered in a single database containing all drivers and information about them.
- Bonus-Malus subject. It is a concept that refers to the person whose Bonus-Malus class is assessed and calculated. This person can be the owner or holder of the vehicle. Please note that the class is assigned not to the vehicle but to the Bonus-Malus subject. So, if someone else drives your car and causes an accident, it will affect your Bonus-Malus class.
- Classes. There are 17 classes in the Bonus-Malus system. Classes 1 to 5 are higher risk (Malus class) and are given to drivers who cause more accidents. A Bonus-Malus subject in this class should expect higher MTPL policy prices. On the other hand, classes 7 to 17 (Bonus class) are awarded to those Bonus-Malus subjects, who behave reasonably on the road and regularly purchase MTPL policies.
So, the Bonus-Malus class is important to evaluate and adjust MTPL insurance policies according to each person’s level of risk and behaviour on the road.
How is the Bonus-Malus class calculated?
The Bonus-Malus class is calculated taking into account the last 11 years of insurance history of the Bonus-Malus subject. To determine the increased Bonus-Malus class, the vehicle must be insured for at least 275 days per year. Otherwise, the vehicle remains in Class 6. The Bonus-Malus class is automatically recalculated once a year on 15 September.
How is the MTPL insurance price calculated?
The price of MTPL insurance depends on several factors and may vary depending on the type of vehicle, driver experience, Bonus-Malus class, and other conditions. To determine the specific price, it is necessary to consider the following factors:
- Bonus-Malus class. The higher the Bonus-Malus class, the lower the insurance price. If you have a good insurance history and avoided accidents, this can have a positive effect on the price.
- Type of vehicle. The price varies depending on the type of vehicle – car, motorcycle, or other type of vehicle.
- Insurer. Different insurers offer different prices and services. BTA offers several additional benefits to ensure your safety and peace of mind:
- A combination of other types of insurance. At BTA, you can also purchase other types of insurance, such as travel insurance, accident or home insurance.
- 24/7 customer support. BTA provides customer support at any time of the day. If you have questions or need help, do not hesitate to contact BTA specialists.
- Quick and easy insurance process. BTA offers a convenient and understandable insurance process. You can easily buy a policy online or contact a BTA branch.
- Additional coverage amount. If you want additional coverage, BTA offers the following additional MTPL coverage options:
- Indemnity at your own insurer. You will not need to contact another insurer if your car is damaged after an accident and the other driver is at fault. BTA will settle the indemnity and pay for the repair of Your car.
- Roadside assistance. Technical assistance on the road, fuel delivery, delivery to the car repair shop, taxi services, rental car, assistance in drawing up the agreed notification – at any time of the day.
- Insurance term. The price may vary depending on the term of the insurance (for example, 6 months or a year).
Find out the price of your MTPL insurance!
