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Motor insurance, How much does it cost?

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Magazine Issue: 
The precautionary principle [3]
Magazine date: 
May 2010
Atlas Magazine proceeds to the updating of a survey conducted in 2004 and dealing with motor tariffs (Atlas Magazine n°10, April 2004). The 2010 survey is studying the evolution of the motor third party liability premium of a 7 horse power petrol car, first circulation in 2008, for private use. Survey period: 2004-2010.

Car insurance quotes for a 7-horse horse power petrol car (motor TPL)

in USD
 TPL premiumVariation from 2004 to 2009Remarks
CountryMarch 2010March 2004of the premiumof the $of the CPI 2 
Algeria
27.528-1.78%+1.2%17.96%
  • Legal tariff
Senegal
135.49641%-7%15.22% 
Saudi
Arabia
93.3100-6.7%0%23.06%
  • Free tariff
  • Guarantee limit of 1.33 million USD, physical & material damages combined
Lebanon
1003125-20%-1.5%23.77%
  • Free tariff
Tunisia
199414042.1%+9.2%19.55%
  • Tariffs vary according to the experience & to the bonus-malus system
Cameroon
156164-4.8%%-7%17.30% 
Côte d'Ivoire
164169-2.9%-7%22.15%
  • Tariff for the zone of Abidjan
Morocco
33429214.3%-4.4%13.66%
  • Legal tariff
1 Variation of 2004 at 31/12/2009 2 Consumer Price Index. Source: International Monetary Fund, variation of 2004 at 31/12/2009. 3 Average tariff. The third party liability guarantee may vary from 33 USD to 133 USD depending on the companies. 4 Average tariff. The third party liability guarantee varies between 66 USD and 332 USD.

Motor insurance tariffs: continuous disparities

The disparities that existed in 2004 within the same geographic area and for the population of comparable standard of living are still there in 2010.

In the Maghreb region, tariff gaps between Morocco and Algeria have grown between 2004 and 2010. From 1 to 10.4 in 2004, this gap has risen from 1 to 12 in 2010. The situation is even more disadvantageous for Algeria if we consider the +17.96 variation of consumer prices for the same period.

In Morocco, the tariff increase has been more or less offset by the rising cost of living. The increase in value of Moroccan dirham versus the dollar by +4.4% is also to be taken into account. In Tunisia, the introduction of a new method for the calculation of the motor premium does not allow any comparison with the 2004 period.

Image provided to Microsoft by iStockphoto. Used with permission from MicrosoftIn Saudi Arabia, car insurance quotes have fallen between 2004 and 2010. Like in Algeria, this nominal decrease has become worse by the +23.6% inflation. In real terms, Saudis pay less for their motor insurance in 2010 than in 2004.

In sub-Saharan Africa, the picture is even more mixed. It is in Senegal that tariffs have reported the highest increase with +41%. This rise is visibly higher than the inflation rate. The CIMA zone countries are benefiting also from the decline of the American currency in relation to the CFA franc (-7%).

Rated in dollars or in CFA francs, Cameroonian and Ivorian car insurance quotes have slightly gone down between 2004 and 2010. In real terms, the fall of these quotes is clearly more consistent in these two countries.

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