Mandatory vehicle third-party liability insurance in Bulgaria is set to become more expensive again in the opening days of 2026, with price increases estimated at around 8 to 10 percent, based on a comparison of current offers from the country’s major insurers. The adjustment comes shortly before the planned rollout of the bonus-malus system in February, which is expected to raise base premiums across the board, regardless of individual driving history.

Young and urban drivers feel the impact first

The sharpest increase is being felt by drivers with up to five years of experience, particularly those living in larger cities such as Sofia, Plovdiv, Varna and Ruse. For this group, policies priced below 400 leva, roughly 205 euros, have become rare. Just a few months earlier, in mid-2025, the same profiles could still secure coverage for about 370 to 380 leva, or approximately 190 to 195 euros.

Insurers justify the higher prices with ongoing inflationary pressures, rising costs for spare parts, more expensive labor in car repair shops and the general increase in vehicle prices. At the same time, questions persist over whether actual repair costs are growing at the same pace as insurance premiums.

According to insurance brokers, cheaper offers still exist, but they often come with conditions. In many cases, clients are required to purchase comprehensive Casco insurance from the same company, which ultimately raises the total cost for the driver.

Bonus-malus system without unified rules

More substantial changes for motorists are expected from February 2026, when the bonus-malus mechanism is scheduled to take effect. Unlike earlier plans for a centralized, state-regulated model, the new approach will be decentralized.

The Guarantee Fund will act mainly as a data center, collecting information on claims and damages. Each insurer, however, will independently decide how bonuses and penalties are calculated and applied.

This model carries clear risks. Without a single standard, one company may impose harsh penalties even for minor damage, while another may adopt a more lenient assessment for similar cases.

What the market expects

Market forecasts suggest that penalties for high-risk drivers could reach up to ten times the standard premium. For disciplined drivers, the expected bonuses are likely to remain close to average market levels, meaning that a noticeable reduction compared to today’s already elevated prices is unlikely.

Information cited by the daily “24 Chasa” indicates that insurers have already developed internal risk-scoring systems. Even small incidents, such as a scratched door or bumper with damage estimated at around 80 euros, will be recorded in a driver’s profile. In more serious cases, with repair costs reaching up to 5,000 euros, premium increases could be substantial.

Unresolved questions remain

The Financial Supervision Commission is preparing a regulatory framework that should be presented for public discussion in February. Despite this, several key issues remain unclear. These include how fictitious car sales will be prevented as a way to erase negative histories, how the system will apply to family-owned vehicles used by multiple drivers, and how liability will be distributed for company cars and large fleets.

The dominant view within the sector is that the new system will be more punitive than rewarding. At the same time, clear procedures for appealing wrongly imposed penalties have yet to be defined. Unlike the failed 2018 attempt, which proposed increases of up to 400 percent, the current changes are expected to be introduced gradually, through the pricing strategies of individual insurers, but starting from a higher base level at the beginning of 2026.