After the loss of auto insurance consumers hardly antitrust profit

Posted on 9/22/2014 3:49:03 PM

In a recent automobile antitrust storm out of the "ticket price", there is a 110 million yuan in ticket open to the Insurance Association of Zhejiang Province, and related insurance company, its monopoly mainly in auto insurance rates agreed discount rate and the market share agreed unified commercial insurance agency commission.
This a billion dollars in fines to create a new record antitrust Insurance. And as for the other areas of antitrust, consumers are willing to believe that there is hope to make such a generous premiums declined to bring their own benefits. Things are not so simple. Zhejiang auto insurance, for example, the NDRC's penalty decision as early as nine months has been issued before, but it is understood a number of 4S stores in Hangzhou current auto insurance rates unchanged, the first year of commercial car insurance discount is still the industry had agreed 9.5 fold.
4S shops and auto insurance cooperative mode still
This history of the insurance industry's most stringent fines, exposed between insurance companies, insurance companies and conflicting interests 4S shop.
As a traditional insurance sales channels, 4S shop mastered the huge number of customer resources, seize the vehicle sales and maintenance of ports. Insurance companies in order to sell their products, has formed partnership with the normal binding 4S shop, and provide agency fees 4S. According to relevant regulations, agency costs insurance companies for 15% of total insurance business.
The antitrust penalties rid of a horizontal price agreement the insurance industry, and binding partnership 4S shops and insurance companies still exist. Consumers buying a new car is often required to buy their insurance partner companies in the 4S shop, and the price more often than other channels, such as higher car phone. Because insurance agents 4S shop car phone was none other costs to the consumer.
On the other hand, the CIRC data show that domestic insurance companies pay for auto insurance claims submitted Qi Cheng automotive parts replacement. In 2013 there were nearly 60 manufacturers of spare parts carried out more than 170 times the price adjustment, the insurance company costs continue to rise.
The car also involved in the anti-monopoly on automotive suppliers punishment, unreasonable expectations of changing the whole car than zero. However, the current situation of zero integer ratio adjustment, substantially lower level is limited. So in order to cut auto insurance company premiums, will be a long-term process.
There are also free-market worries
Auto insurance industry is not free-market did not experience.
It is reported that in 2003 China Insurance Regulatory Commission once the market starts auto insurance rates, but the ensuing vicious price competition led auto insurance industry into a serious loss. In order to regulate the market, the CIRC launched PICC in 2006, CPIC and Ping three terms of standard, commercial auto insurance benchmark rates unity.
But P & C insurance company in order to obtain more available to the 4S shop competing agency fee increase, already more than 15% of the limit, and some even as high as 40%. Situation of auto insurance industry losses continued. 2013, in addition to PICC, Ping An Insurance and Pacific Insurance, National Insurance Company the remaining 46 auto insurance business line losses.
In Hubei, currently subject to punishment, although the FAW - Volkswagen Audi Sales Company and seven distributors, but the investigation of the "fuse" is the difference between the dealer and the insurance company on car damage pricing. Hubei Audi dealers that some insurance companies in the auto insurance market monopoly to suppress the formation of its service prices.
In this case the insurance industry practice of Wuhan car insurance policy from a total of June 2003 set up "new car coinsurance" center, withdrew permission 4S shop of auto insurance agents, consumers buy new cars, unified to center for auto insurance formalities, then with documents to Vehicle Administration license.
Zhejiang horizontal price agreement with Hubei car coinsurance policy, are the industry in order to avoid vicious competition, save the loss-making situation, measures to improve the bargaining power of the 4S shop for the actions taken, but have violated the monopoly regulations.
Commercial auto insurance reform difficult prospect given
Perhaps antitrust penalties for auto insurance, the greater significance is to promote commercial auto insurance reforms. Industry comments are plans to implement the new business models of insurance and claims the way early next year, will be more related to the vital interests of consumers.
At present, the main basis for new car to purchase auto insurance pricing conduct, but the real cost of maintenance to a greater extent depends on the price and maintenance costs of the brand parts. Business models after reform will take "a car for a price" pricing model, the price of spare parts and maintenance of the direct marketing premium car, while car companies reduce "zero integer ratio" has become a trend.
After the commercial insurance market reform, the industry may face a reshuffle, stronger insurance companies will have more opportunities to poor management of the enterprise may be eliminated. For example, after the implementation of Taiwan's insurance market reforms, industry profits decline, thereby giving rise to a large number of mergers and acquisitions or even liquidation.
And if the industry vicious price competition situation occurs again, then in limited profit margins, insurance consumers to enjoy the quality of service may decline, such as dragging a single, but unfortunately the pay and other issues, because the cost will eventually be passed on to consumers.
For consumers, want to see is to break the monopoly, competition is more fair, the premiums can be correspondingly reduced. But the auto insurance industry complex situation, in order to get the ultimate benefits, consumers need to be patient.

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