OREANDA-NEWS. April 13, 2010. In its statement of April 8, 2010 MAKS (CJSC) confirms that the debt amount announced by Ingosstrakh is inaccurate since it does not take into account the limited amount of indemnity under OSAGO, as well as amounts related to component wear. Moreover, MAKS believes that the disclosure of the debt amount is in itself an inadmissible act which has a generally negative impact on public confidence in the insurance market.

With regard to the reference of MAKS CJSC to the discrepancies between the debt amounts announced by Ingosstrakh with its own data in this respect, we would like to stress that due to the firm stance of this insurer consisting in the refusal to voluntarily pay under subrogation claims, Ingosstrakh was deprived of any opportunity to carry out due comparison of the debt-related data available from both companies.

Ingosstrakh regularly forwards claims to insurance companies, including MAKS, for damage amounts offering them to make voluntary payments. However, MAKS has made practically no payments in favour of Ingosstrakh without relevant court decisions being in place.

In its statement MAKS mentions a letter received by Ingosstrakh in March 2010 containing an offer to resume the operation of the system of mutual voluntary payments under due claims.

MAKS however does not disclose the reasons for termination of voluntary payments between our companies. Ingosstrakh was compelled to remind this company of the professional ethics and the notion of “partnership relations” an adherent of which the mentioned insurer explicitly declares itself. In its press release of April 5, 2010 Ingosstrakh published the information concerning the MAKS CJSC debt growth, starting with the 1st quarter of 2009 until present time. At the beginning of the past year, due to the significant debt growth, Ingosstrakh began to apply considerable effort towards the goodwill resolution of the issue of settlement of claims with MAKS CJSC. Negotiations between the two companies concerning a simplified procedure for settlement of claims were underway. The only option acceptable for this company would have been simultaneous exchange of insurance indemnities in the amount of 10,000,000 rubles, the debt of MAKS CJSC was at the time about 3 times higher than that of our own company. After the submission of that offer voluntary payments by MAKS had practically come to a halt. Due to this, Ingosstrakh was compelled to file claims with the court and inform the Federal Insurance Supervision Service and the Russian Association of Motor Insurers of the violation on the part of MAKS CJSC of the procedure and term periods for consideration of claims. We would like to stress that over the period from 01.01.2009 to 01.04.2010 the courts had delivered 1,087 decisions on recovery of subrogation amounts from MAKS CJSC, whereas another 600 claims are currently being examined by courts. That being said, the courts recognise the validity of and satisfy about 97% of claims lodged against MAKS CJSC.

The first signs of the concern over the situation with the mutual failure to pay were only demonstrated by MAKS CJSC in March 2010 when the company sent the above-mentioned letter to Ingosstrakh.

In its message MAKS accuses Ingosstrakh of ignoring proposals and offers contained in this letter requesting to make mutual revisions, failing however to mention that in March the respective authorised person was immediately forwarded a list of requirements of OJSIC Ingosstrakh. Negotiations had been repeatedly conducted with them and relevant information was forwarded in response to their inquiries.

By way of information we state that the total debt amount of MAKS CJSC under current claims file under the subrogation procedure is 83,307,799 rubles, the respective debt amount of Ingosstrakh is 24,574,446 rubles.

 Considering the current situation, Ingosstrakh has published information on the constantly growing debt of MAKS. In the event that the company persists in its stance concerning payments being made only upon presentation of court orders, Ingosstrakh will be compelled to continue to publish information on its debts, as well as inform the Federal Insurance Supervision Service and the Russian Association of Motor Insurers of relevant violations of the insurance law.

We believe that the current stance of the MAKS company consists in the well-known formula “words instead of money”, which is clearly incompatible with the proclamations of respect for partnership relations and the ethics of insurance business so keenly upheld by the major debtor of Ingosstrakh.

Director of the Legal Department, Member of the OJSCI Ingosstrakh Board of Directors, Ivan Novikov.