Date
18 December 2017

Maintenance costs in focus in China auto insurance pricing

Vehicle maintenance costs are expected to be taken into account in China’s new auto insurance pricing regime, the National Business Daily reported Friday, citing an industry insider.

Currently, maintenance costs in China are much higher than those on the international market, the paper said. Replacing all the parts in a Mercedes c-class w204 car in Beijing will, for instance, cost so much that one can buy 12 such new vehicles with the same money, it said.

Analysts were quoted as saying that such high maintenance expenses are partly due to the higher import costs of auto parts.

Under the ongoing auto insurance pricing reform, a higher premium rate should be applied to vehicles having high maintenance costs, experts said. At present, vehicle insurance premium is determined by the vehicle cost. Cars that cost the same enjoy same insurance rates, regardless of the potential difference in maintenance expenses.

– Contact HKEJ at [email protected]

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