YEREVAN, January 25. /ARKA/. About 20%-30% of car owners in Armenia chose to not prolong their car insurances, Samvel Grigoryan, the executive director of Reso insurance company, said Tuesday, adding that there are two reasons for it.

First, car owners are unaware that the failure entails a penalty and the second reason is that they simply can not afford it. He said for car owners who can not buy new car insurance Reso offers to do so on installment or take a loan from a bank.

Samvel Grigoryan said car owners who fail to extend their car insurances will have to pay a 5000 dram penalty for every ten days.

The law on mandatory insurance of motor vehicles entered into force on January 1, 2011. It provides protection against losses incurred as a result of traffic accidents and against liability that could be incurred in an accident. According to official data, there are about 430,000 cars in the country.

Reso’s charter capital stands currently at 1.870 billion drams. It was founded by Russian Reso Garantia. ($1 – 387.69 drams). -0-