The Guarantee Pricing and the Analysis of the Automotive Branch Insurance Profitability in Tunisia

The presented study thoroughly investigates the technical profitability of the Tunisian automobile insurance market using a quantitative research approach with interpretivism as its foundation. The study aims to offer insightful information about the dynamics and profitability of the sector by concentrating on the combined ratio and applying the S/P ratio calculation. The data show that the Tunisian auto insurance industry faces serious obstacles. The S/P ratios continually exceeded 100% from 2019 to 2021, indicating a chronic problem of low technical profitability. Notably, the civil responsibility guarantees considerably added to this imbalance, particularly in the “agricultural utility” and “2-wheel use” categories, with S/P ratios rising to frightening heights, like 937% in 2012. These findings highlight the pressing necessity for pricing modifications and a thorough comprehension of the nuances of the market. The Tunisian auto insurance industry must address underpricing concerns and increase overall profitability viable over the long run. This study offers helpful insights for policymakers and business experts trying to manage these difficult issues and promote a more vibrant insurance market.