Motor insurance compensation limits to rise in Armenia

PanARMENIAN.Net - Compensation limits in Armenia’s compulsory motor third-party liability insurance system will increase from April 1, said Vaghinak Yeghiazaryan, executive director of the Armenian Motor Insurers’ Bureau, during a press conference.

According to him, the decision is based on the system development strategy, which includes measures aimed at making the system more customer-oriented.

Under the new rules, the compensation limit for property damage per person will increase from 1,800,000 drams to 2,500,000 drams.

For damage to health and life, the limit will rise from 3,300,000 drams to 3,500,000 drams, Sputnik Armenia reports.

Yeghiazaryan noted that in many road accidents the actual costs exceeded the previous limits, creating an additional financial burden for citizens.

According to him, the new limits will allow a significantly larger share of damages to be covered, reducing out-of-pocket expenses for victims.

“Our calculations show that when a maximum compensation limit exists, payments above that threshold are not made. Overall, about 94% of damages are compensated. For example, if the limit was 1.8 million drams but the damage reached 2.5 million drams, the citizen had to pay 700,000 drams themselves. Increasing the limit will benefit citizens, although we cannot aim for 100% compensation,” he said.

The bureau’s executive director added that the reforms also increase the maximum total payouts per accident for all victims.

For property damage, the cap will rise from 18 million drams to 25 million drams, while the limit for damage to health will increase from 33 million drams to 35 million drams.