CHANGSHA/SINGAPORE, CHINA/SINGAPORE - INFLUENCED by the Toyota recall crisis, insurance companies in China have raised premium rates for most of the Japanese carmaker's vehicles, according to Changsha Evening News.

A Toyota car owner, who was seeking to renew his vehicle insurance, told a reporter that he found premium rates given by the insurers he contacted to have obviously risen.

One anonymous business manager from China Pacific Insurance told a reporter in private that major insurance companies raised the prices for almost all Toyota models, some as high as 40 per cent.

In Singapore, however, premium rates will not rise on Toyota models.

A spokesman for AXA Insurance Singapore said that there are no plans to raise the premiums for Toyotas and that "adjustments are not based on triggers such as the recent safety recalls".

NTUC Income's spokesman said that it "has no plans to adjust premiums for Toyota models" since they have not "encountered any incidents relating to the problem of the vehicles that were recalled".

American Insurance Group was also contacted, but did not respond by press time.

Borneo Motors, an authorised Toyota agent, also said that there will be no increase in insurance premiums. Its marketing director, Mr Klaus Redomske, said: "In Singapore, the rates for Toyota insurance are competitive."

In more developed insurance markets, the common practice is that premiums for different models vary, so insurers need to have a firm grasp on cars' safety performance and maintenance costs in order to fix a price for its policies.

In the Toyota recall case, American insurers were the first to publicise the vehicles' safety flaws.

China's vehicle-insurance industry, which has been caught in a price war, still has a long way to go in developing a similarly advanced system, Mr Luo Zhongmin, chairman of the Insurance Institute of China, pointed out. --ASIAONE, CHINA DAILY/ASIA NEWS NETWORK