What does the bonus-malus system mean in traffic insurance?

The bonus-malus system used for traffic insurance is based on classifying a driver’s risk level according to their claims performance in previous policy periods. The basic idea is that claim-free policy periods can lead to more favorable pricing, while claims can result in a more expensive renewal.

This structure becomes especially important at the insurance renewal stage. Claims filed during the policy term, fault status, and how those records are processed in the system can affect which level the driver continues at in the next period.

How do no-claims discounts and premium increases happen?

What happens in claim-free periods?

In general practice, no claims during the policy term, or the absence of a record that would work against the driver, strengthens expectations of a no-claims discount. This can help place the driver in a lower-risk group and may reduce the premium.

However, the final amount at each renewal is not based solely on claim-free driving. The vehicle type, usage purpose, province, driver profile and general pricing conditions in that period can also affect the policy cost.

Why can the bonus-malus level change after a claim?

When an accident or claim record occurs, the system may reassess the driver’s risk. At that point, a premium increase may come into play depending on the nature of the damage, fault assessment and how the file is reflected in the policy records.

  • How much responsibility the driver bears for the damage matters.
  • More than one claim in the same period can affect renewal terms more clearly.
  • Official regulations and insurers’ current practices can determine the outcome.

What should drivers check before renewing their policy?

It is useful for drivers to review their policy details and claim records before the renewal date. In particular, making sure the records have been processed correctly makes it easier to understand the reason for any unexpected price difference.

At this stage, records from the Insurance Information and Monitoring Center (SBM), policy details and the information notes provided by the insurer can be reviewed together. If there is any dispute or uncertainty, official explanations and written information from the company can help clarify the process.

In short, the bonus-malus system is one of the main mechanisms in mandatory traffic insurance that reflects a driver’s past performance in pricing. While claim-free use can bring an advantage, claim records can result in a higher renewal premium; for that reason, it is important to review the policy carefully at the end of each period.