IRSA agreement between French motor insurers
An agreement among French motor insurers that organizes direct indemnity of the insured by its own insurer and flat-rate settlement of recoveries between insurers according to a liability schedule based on the accident report.
The motor claims indemnity and recovery agreement, which succeeded older agreements, binds almost all motor insurers operating in France. It rests on two mechanisms. Direct indemnity: an insured who is not at fault, or partly at fault, is indemnified for property damage by its own insurer, without having to claim from the other party's insurer. Conventional recovery: the insurer that paid turns against the at-fault party's insurer, not on actual cost but under simplified rules, based on a schedule that determines liability from the boxes ticked on the joint accident report and, for small claims, a flat amount. The agreement greatly speeds up handling, since it removes most discussion between insurers about liability and valuation, and it reduces the processing cost of millions of claims a year. It is not binding on insureds, whose rights remain those of general law: an insured who disagrees with the allocation of liability applied can always challenge it. For the actuary, it creates apparent claims experience mixing real costs and flat-rate flows between insurers.
Textbook case: two vehicles collide at an intersection; the joint report shows one failed to yield. The not-at-fault driver's insurer repairs its vehicle for 2,300 euros, then recovers from the other insurer under the conventional schedule, without joint appraisal or exchange of documents.
Follow the research
One letter a week. First, the week's underwriting note, when one is published: a dated, argued decision, signed by Paul Bernardski. Then what the observatory published on cyber risk, political risk and insurance. No account, no tracking.
No spam, one-click unsubscribe, no data ever sold.