• Kyodo News

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The Financial Services Agency is poised to set the average hike rate of premiums on compulsory auto liability insurance policies at 11.7 percent in fiscal 2011, according to a draft of the final plan.

The plan, which requires owners of minivehicles to pay an additional ¥3,000 for two years of coverage, for example, is expected to be finalized Thursday at a meeting of the agency’s council of automobile liability insurance.

The rate of increase will differ according to vehicle type, with minivehicles seeing a higher increase rate than larger cars due to higher accident rates.

According to the plan, the premium for two-year coverage for minivehicles will be ¥21,970, up ¥2,990.

Larger cars will see an increase of ¥2,480 to ¥24,950, while premiums for scooters will be ¥9,420, up ¥630.

The premiums exclude cars in Okinawa Prefecture and remote islands.

All car and motorcycle owners are required to take out liability policies. Most car owners purchase additional voluntary car insurance because the compulsory insurance provides a limited amount of money in compensation for death and severe damage.

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