Global economic trends, rising oil prices, and logistics disruptions are pushing auto insurance costs higher, according to Kote Sulamanidze, CEO of BB Insurance. He notes that the sharp increase in vehicle spare-parts prices is the main factor driving premium adjustments, as repair costs directly affect insurance pricing.
Sulamanidze explains that supply shortages also contribute to rising costs. Much of Georgia’s spare-parts market depended on imports from Dubai, where production has decreased and transportation difficulties have intensified. Additionally, new regulations affecting the import of damaged cars, previously dismantled in Georgia for cheaper parts, are making repairs more expensive.
He warns that if prices continue to climb, insurance may become unaffordable for many consumers. Sulamanidze argues that the only way to stabilize prices and support sector development is the introduction of mandatory auto insurance. By expanding the insured pool, he says, premiums could be reduced through diversification.
According to Sulamanidze, compulsory insurance is essential both for social safety and for preventing insurance from becoming a “luxury item” in Georgia.
