As of January 1, 2026, Albania began applying the bonus-malus system to compulsory third-party motor liability insurance (TPL) for vehicles operating within the country.

The bonus-malus system provides that drivers who cause accidents resulting in insurance claims will pay a higher insurance premium the following year, while those who do not cause any damage will benefit from a lower premium.

According to the relevant regulation issued by the Financial Supervisory Authority (AMF), the system currently consists of only three classes.

Class I, which includes drivers who have caused no damage during the year, applies a coefficient ranging from 0.95 to 0.98 of the basic premium.

Class II includes drivers who have caused one claim during the year and applies a coefficient of up to 1.25.

Class III includes drivers who have caused two or more claims during the year and applies a coefficient of up to 1.5.

In practice, however, according to the coefficient tables currently used by insurance companies, the applied coefficients are lower than the maximum levels permitted under the regulations.

For drivers who have caused a single claim, a coefficient of 1.18 will be applied to the basic premium, while drivers who have caused two or more claims will be subject to a coefficient of 1.39. In other words, drivers responsible for one claim during the previous year will face an 18% malus surcharge, while those responsible for two or more claims will face a 39% malus surcharge.

Drivers who have not caused any damage during the year will benefit from a 3% bonus in the price of compulsory third-party liability insurance.

Furthermore, the coefficient table is identical across all insurance companies, providing yet another indication of the lack of effective competition in this segment of the insurance market.

Meanwhile, the Albanian system remains very limited compared with those in other countries in the region and across the European Union, where the bonus can exceed 50% of the basic premium if a driver remains claim-free for a specified number of years. A similar principle applies to the malus.