Home » Business » Hello Auto assumes the new tax and encourages the sector 01/31/2021

Hello Auto assumes the new tax and encourages the sector 01/31/2021

Both Unespa, the employers’ association of the sector, and the different insurance companies in Spain have shown their absolute rejection the rise from 6% to 8% of the tax on insurance premiums by 2021, an increase not seen in 20 years that pushes up the price of premiums paid by policyholders.

The decision has been unilateral and this is what has most angered the sector, according to denounce, the Government never established a dialogue with the insurers before approving the bill of General State Budgets (PGE) that includes this increase.

The president of Unespa, Pilar González de Frutos, has assured that the sector learned of the measure through the press conference of the Council of Ministers that approved the budgets. In the middle of this stage Spain’s Hello Auto has decided not to pass on this expense to its clients and has filled the rest of the insured with hope.

HELLO AUTO TAKES THE FIRST STEP

The insurtech (which has a license from the General Directorate of Insurance and started its activity last year) considers that this increase from 6% to 8% it could mean a considerable increase in the cost of the car policy, one of the most demanded insurance by the Spanish and the branch to which they are dedicated.

According to Unespa data, 79% of Spaniards have insurance linked to their car. The company calculates that this measure, plus the bonuses it offers for good driving, it will generate savings for policyholders of at least 100 euros.

That is why it has wanted to adopt this measure, to generate real savings for Spaniards in insurance, even more so in an “extraordinary” moment, with more than 700,000 people in ERTE and more than a million workers who have lost their jobs due to the pandemic.

WILL THE OTHERS FOLLOW YOU?

It is the first company in the insurance sector to take the step and assume the increase in the tax on premiums, so it trusts that your decision will have consequences at the sectoral level, as explained by the general director of business development of Hello Auto, Martín Martínez, to MERCA2.

“Customer orientation will mark the future of the insurance sector eliminating commodities and seeking solutions that differentiate themselves by generating added value for the consumer”, he highlights.

In this sense, the Hello Auto recalls that they gave away the insurance during the State of Alarm and that the measure that they have adapted now will not be temporary it is part of their DNA “to try to do things the way we like as consumers. What is not fair as a consumer is not fair as an insured ”.

NOT ONLY CARS

The tax increase not only affects auto insurance, but also home and civil liability insurance. Although the taxpayer of this tax is the insurance companies, the tax ends up falling on whoever contracts the productas it applies to you when your insurance premium is collected.

In this way, Rastreator calculates that the upload supposes an average of 8 euros more for car insurance (per vehicle and year) and 4 euros more for home insurance. This affects the majority of Spanish families since, according to the Family Budget Survey, in Spain 95% of households have subscribed some type of insurance.

Among the most common is the car, which, as it is mandatory, 8 out of 10 families have a contract, and the home, which also has a high hiring rate of 74%. In fact, Unespa, the insurance employer, estimates that at the end of 2019 there were 31 million cars in Spain and 19.2 million insured homes.

In this sense, the employers fear that the increase in insurance taxation It could lead to a reduction in the protections that families hire and, consequently, in a greater exposure to risk.

Something that would not happen if the insurers step up and decide to assume all or part of the rise.

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