Ricardo started the procedures to purchase a vehicle from one of the best-selling brands on the Ecuadorian market. Since it was a new car, the dealership asked him to take out credit liability and anti-theft insurance, as well as a satellite tracking service, and they gave him the contact of an insurance broker to handle the management.

And when it asked for costs, it showed a high monthly price: I have to pay almost $80 a month for both insurances. When I asked why, they said it was because of the high level of insecurity and accidents in Ecuador. He previously assured that the costs for these insurances do not exceed $50 or $60, “very expensive.” He tried to take out other insurances with another intermediary, but “they are full of buts and buts, that the car must be inspected even if it is new and it is not certain that they will accept it. “They have a list of cars they supposedly no longer insure.” He ended up having to take out the dealership’s insurance.

Insurers paid more than $152 million for car accidents in the first half of 2023, up 18% from 2022.

Lists of individual insurers have been circulating on social networks since August, on which certain makes and models of vehicles are classified as uninsurable. Patricio Salas, executive secretary of the Ecuadorian Federation of Insurance Companies (Fedeseg) and general director of the Association of Ecuadorian Insurance Companies (Acose), explained at the time that historically the traffic accident rate was around 54%, but in 2022 it had risen to 68%, and by July 2023 .was at 75%, which seriously affected the insurer’s results. The market was said to have suffered a technical loss of $10 million by July 2023, although it warned that the overall net result was higher.

Two months later, the general condition does not seem to have improved. Salas now indicates that the results obtained in September reflect an increase in the technical loss by an additional $4 million and at the end of the third quarter of 2023 it has already accumulated to $15 million. However, this does not mean that the measures taken are not effective. “In general… the actions that some insurance companies have taken to solve the problem of the deterioration of the technical result have a longer maturation time, up to a year, which makes it almost impossible to observe the results in such a short period of time. . ..”, he justifies himself.

There are no figures on the impact of these measures on the number of insured persons, but he states that the insurance offer is maintained, although he admits this with different types of adjustments, according to the policies of each company.

Satellite tracking for vehicle recovery has gone from 167 to more than 1000 operations

This increase in traffic accidents is also reflected in the numbers of companies offering satellite tracking services. For example, Carseg (Hunter) reveals that before the pandemic they had 167 annual vehicle recovery operations, and now they plan to end 2023 with more than 1,000. “Which means crime and theft have increased significantly. Approximately six times more than before the pandemic”, the company states.

Vehicle theft leaves insurers with technical loss of $10 million by July, so they are now excluding models and brands from coverage

Diario EL UNIVERSO consulted on the measures taken for the two main brands that record the highest sales of vehicles in the local market: Chevrolet and Kia. They sold 35,571 units out of 102,727 sold from January to September, according to data from the Association of Automobile Companies of Ecuador.

In the case of Chevrolet, the brand announced in September that between Chevyseguro – General Motors’ insurance company -, Chevystar – Chevrolet’s satellite protection service – and a network of dealers, they have developed a protection alternative for owners of Chevrolet vehicles. “Chevrolet customers who do not currently have a protection scheme will be able to take out an insurance policy backed by Chevysegur and installation of a location system with Chevystar technology, with suitable financing options,” the brand said in a statement.

Pablo Camacho, general manager of Chevysegur, assured that no General Motors brand model is currently banned from insurance. “The insurers have agreed to work with 100% of the models, each with a rate and deductible depending on the risk, taking into account factors such as the city of traffic and the type of use of the property,” he explains. He states that the brand has never stopped offering insurance to its customers and states that they place around 750 insurance policies per month between different marketing channels. As for the cost of these new policies, he emphasizes that they are “very competitive products for the Ecuadorian market.”

For his part, José Antonio Errázuriz, commercial director of Kia del Ecuador, explains that the information on the list of uninsured vehicles came from an insurance company that does not represent the reality of the entire Ecuadorian insurance market. “At the moment, all Kia vehicles have insurance policies from major insurers, without any restrictions. In the specific case of the insurer, the subject of the question, about not insuring Kia vehicles, refers to two models that ceased to be on the market in 2016 and 2018, respectively,” says Errázuriz.

He adds that all models of the brand sold from 2022 have an immobilizer system, which reduces the risk of theft by 99%.

‘It was possible to negotiate with insurers with a higher premium cost’

A third brand was consulted within top The top 5 sellers in the country also confirm the existence of models without insurance. “It was not such a big concern for our clients, luckily almost all vehicles of the brand are off the list and are still normally insured”, points out the brand manager of that company, who prefers a reserve. However, he admits that one or two models in his portfolio are on the list of insurers, but reveals that they have managed to negotiate premiums with the companies, although he warns that the cost to the client increases slightly, but there are no details on the proportion.

An Ecuadorian invests an average of $113 a year in insurance, less than half of the region’s average of $265.

Insurance companies are also analyzing the situation. María Augusta Lucio, head of business development at Seguros Alianza, indicates that accidents have undoubtedly increased throughout the market, and this is more evident in the leading brands of the automotive industry, as it goes hand in hand with the composition of the bigger brands. The market. “We also see that the problem is more related to the insecurity situation that affects any vehicle, rather than the type of car.”

Currently, the product with the largest share in Seguros Alianza is precisely the one from the vehicle branch, which has sold close to $23.5 million in net premium so far in 2023. Commercial multi-risk products followed with $7.8 million and group life insurance with $7.1 million.

It ensures that the company does not maintain a list of vehicles that cannot be insured and considers that all vehicles with a maximum age of 15 years pass a vehicle inspection where the use of the vehicle, its condition and mileage are checked.

They also analyze the driver by looking at their history of fines and penalties, points on their license, reported accidents, etc. “We take the time to do these extensive checks to ensure accident rates and meet our clients’ requirements. We always think that we can support all Ecuadorians, that we can protect their investments, without discriminating between brands or models, but taking care to evaluate both the vehicle and the driver,” he explains.