The under-pricing that affects the mass risk category (Automotive) for which there are so many socio-economic consequences, is relatively monitored by the supervisory authority.

This underpricing consists of the minimization, by certain intermediaries and insurance companies, of the amount of premiums, thus reducing the risk components of the insured, on the automobile branch, which constitutes 30% of the portfolio of the CIMA Zone.

This practice is done by circumventing the official pricing for motor insurance, set by the authorities, which provide for a minimum rate based on the following indicative criteria:

The use of the vehicle or the nature of the risk insured: business, public transport, transport of goods, transport of passengers tpv

Despite this well-defined regulation, however, market players tend to dodge this for the practice of "under-pricing" and this has negative consequences on all stakeholders, which raises the problem of performance deficit of the sector of services. insurance, unlike European and North American insurers.

The causes of this abnormal practice of pricing are to be found in the unhealthy competition with an objective of turnover at all costs, the lack of training of the actors and also the very general nature of the control exercised by the supervisory authority.

It should however be noted that over the past few years, this control carried out by the Insurance Department has focused a great deal on compliance with the car tariff, in order to limit this practice of underpricing.

This practice of underpricing is also perceptible in the insurance of risks relating to public or semi-public actors, which are generally the subject of calls for tenders.

Insurers could have agreed on minimum premium levels given their knowledge of the nature of said risks, but also their experience in terms of claims.

On the contrary, these risks see their pricing suffer a regular decrease from one year to the next, due to the dumping exercised by certain players, where on the developed markets, and since the attacks of September 11, 2001, companies in the face of ever-increasing insurance premiums.

Underpricing by the insured is one of the causes of the name diligent payment of claims insofar as the Insurer has not requested the amount of premium necessary to cover the risk, which results in numerous complaints recorded in the management benefits from insurers.

In this, the automobile branch contributes greatly to the image deficit from which the insurance sector suffers.

At the level of insurance companies and other intermediaries, underpricing leads to a shortfall in the sector of nearly 11 billion CFA francs per year, for companies, the majority of which are characterized by low financial capacity, which led the legislator CIMA to introduce an increase in the minimum share capital of limited liability insurance companies, which should increase from one (1) to five (5) billion FCFA in 2021.

In such a context, the under-pricing with the cash deficits that this induces and therefore the difficulties for insurance companies to meet their commitments, constitutes one of the major causes of the sanctions imposed on insurers by the Regional Commission for the Control of CIMA assurances, penalties ranging from permanent surveillance to withdrawal of approval, including placement under provisional administration.

As far as the automobile branch is concerned, this underpricing also impacts the capacity of other players such as the Automobile Guarantee Fund, which suffers a loss of resources derived from civil liability insurance premiums.

The State would benefit from restoring order since it is also a windfall of tax revenue that can be used to finance structuring projects that are lost by the public treasury. Another consequence is a crumpled image that the sector sends back to the public.

In perspective, for the development of the sector, the supervisory authority will have to ensure greater supervision by putting the players face to face with their responsibilities and, if necessary, by applying the sanctions provided for by the regulations in order to eradicate or limit under-pricing. and unhealthy competition prevailing in the motor insurance market in the CIMA zone (Inter-African Conference on Insurance Markets).

In this context, consideration could be given to referral to the insurance department, which plays the role of expert and immediate adviser in matters of insurance, to the national authorities in all insurance projects or programs of public entities or parastatals.

This referral, particularly in the analysis of insurance offers, could be a means of combating underpricing and providing the companies concerned with a guarantee of insurance coverage commensurate with the risks to which they are exposed.