The UK is scheduled to leave the European Union on March 29th, so if you’re planning on driving in an EU member state after this date, what will Brexit mean for you?
Well, if we manage to leave with a deal in place, the UK will enter into a transition period. That means the existing arrangements in relation to motor insurance will remain in place until the transition period is over, by which time we’d expect an agreement to have been reached, almost certainly to maintain the existing arrangements.
If we don’t and we exit the EU without a deal, this arrangement will fall away, which will have a number of consequences for UK residents driving in the EU, and in reverse for EU residents driving in the UK. These include:
Everyone with a UK motor insurance policy is automatically covered by the Green Card scheme, but there has for many years been no need to carry a Green Card within the EEA. If we leave the EU without a deal, the strong advice being given by the Motor Insurers’ Bureau (MIB) is that anyone driving a UK-registered vehicle in EEA countries must carry a Green Card. The risk of not doing so is that the driver is unable to provide valid evidence of Green Card cover and their vehicle may be impounded.
Insurers must issue a Green Card if asked to do so (some may charge an administrative fee), but there are a number of complications:
- The Green Card must be Green and while there’s no requirement for it to be a card, it must be on paper; an image of a Green Card on a phone, even if it contains all relevant information, is not compliant. There is no stipulated shade of green, but the presence of white borders, e.g. if it is printed out in colour on a sheet of white paper, could result in the document being rejected by police or customs officials
- If the insurance policy expires during the period of travel overseas, a second Green Card will be needed for the renewed insurance period
- Some countries require separate trailer insurance for trailers and caravans, so separate Green Cards may be needed for those.
The system in place that enables victims involved in accidents abroad to pursue their road traffic accident claims in their own countries, and ensures that cover is in place for the victims of uninsured drivers in foreign vehicles, was set up by the Fourth Motor Insurance Directive. Since that Directive will no longer cover the UK if it leaves the EU without putting alternative arrangements in place, UK residents will lose this protection.
Uninsured Driver Claims
In some countries in the EEA, the terms of their Guarantee Funds will not cover UK residents once the UK ceases to be part of the EU. France is one of those countries, so any UK resident who is injured by an uninsured driver in France will not be protected by the Guarantee Fund.
MIB Handling Role
This also means that the current system, under which the Motor Insurers’ Bureau (MIB) will deal with the claim if the foreign insurer doesn’t appoint a UK handling agent, or if the insurer or its agent fails to respond within 3 months, will no longer apply. The MIB have indicated that they will continue to assist as far as they can in putting claimants in contact with the relevant foreign insurer, but they will no longer be legally obliged to step in.
Current MIB Claims for Foreign Uninsured Drivers
The MIB are asking that Court proceedings be issued before March 29th 2019 in respect of all claims which they’re dealing with where the driver of a foreign-registered vehicle was uninsured. The organisation says that they won’t raise any premature litigation arguments in these cases.
If the current reciprocal arrangement under the Fourth Directive no longer applies, they’ll be able to recover their outlay from the relevant foreign National Motor Insurers’ Bureau only if Court proceedings have been issued before the Directive ceases to apply. The MIB have said that they will not settle claims where proceedings have not been issued by this date.
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