Lower premiums in Israel for compulsory insurance for private cars bought from the insurance company pool websitewill come into effect tomorrow, March 1. The cut in price has been ordered by Minister of Finance Moshe Kahlon and Supervisor of Capital Markets, Insurance and Savings Dorit Salinger as part of a reform of Israel's compulsory insurance market and for some drivers premiums will fall by up to 40% over the next few years.
These measures will lower the cost of compulsory auto insurance for 850,000 private vehicle owners (about 50% of all private vehicle owners) by substantial amounts, mainly for young drivers and drivers of cars with life-saving safety systems.
The measures, which are slated to go into effect gradually this year will bolster competition in the sector, reduce reciprocal subsidizing among policyholders, and adjust the risk to the price of the insurance.
Since the reform in the sector began in 2003, compulsory insurance premiums for the public have dropped 35%, saving the public a cumulative NIS 15 billion.
Compulsory car insurance covers drivers in the event of injury to themselves, their passengers, other vehicles and their passengers and pedestrians.
Kahlon said, "The lower premiums that come into effect tomorrow are another step in the efforts of the Ministry of Finance to lower the cost of living. I'm happy that we have succeeded in a short period of time to deal with prices that prey on Israeli drivers and work towards improving competition in the sector. We will continue to promote measures to cut insurance costs."
Published by Globes [online], Israel business news - www.globes-online.com - on February 29, 2016
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