CLAIMS SETTLING WITHIN AND OUTSIDE THE EUROPEAN UNION

EU MOTOR INSURANCE DIRECTIVES

5 Motor Insurance Directives:

Objectives of First, Second and Third Directives:

- Compulsory MTPL insurance- Abolishment of border insurance checks- Single policy covers the whole Community- Establishment of guarantee funds

EU MOTOR INSURANCE DIRECTIVES

IV. Motor Insurance Directive:

- Protection for visiting victims- Direct action right against the insurer- Insurance Information Centres

EU MOTOR INSURANCE DIRECTIVES

V. Motor Insurance Directive:

- Pedestrians and Cyclists - specific categories of accident victims- Minimum Liability Limits

EU MOTOR INSURANCE DIRECTIVES

V. Motor Insurance Directive:

Starting from June 2012 insurance limits in EEA countries are:

Property damage: EUR. 1.000.000 per accident.

Bodily injury: EUR. 1.000.000 per victim or EUR. 5.000.000 per accident.

EU MOTOR INSURANCE DIRECTIVES

5 Motor Insurance Directives:

- Single EU Insurance Market ?- Freedom of Services- Freedom of Establishment

Primary Aim: to provide clear and easily applicable rules to determine what law applies to the traffic accident.

Main Principle: lex loci delicti commissi - the law of the country of the accident.

HAGUE CONVENTION ON THE LAW APPLICABLE TO TRAFFIC ACCIDENTS OF

1971

-Right of direct action against the insurer.

-The rules of the Convention apply universally: they are independent of whether the law is that of a Signatory State or not.

HAGUE CONVENTION ON THE LAW APPLICABLE TO TRAFFIC ACCIDENTS OF

1971

- Special Rules: Law of the country of vehicle registration

Involvement of single vehicle (claims of passengers) Several vehicles (all registered in the same State) Involvement of people outside the vehicle (all people with habitual residence in the country of registration)

HAGUE CONVENTION ON THE LAW APPLICABLE TO TRAFFIC ACCIDENTS OF

1971

- General Rule:

- Applicability of the law of the country in which the damage occurred.

ROME II REGULATION OF EU ON THE LAW APPLICABLE TO NON-CONTRACTUAL

OBLIGATIONS (2007)

- General Rule:

Where the person claimed to be liable and the person sustaining damage both have their habitual residence in the same country at the time when the damage occurs, the law of that country shall apply.

ROME II REGULATION OF EU ON THE LAW APPLICABLE TO NON-CONTRACTUAL

OBLIGATIONS (2007)

- General Rule :

All claims shall be handled by the bureau with complete autonomy in conformity with legal andregulatory provisions applicable in the country of accident relating to liability, compensation ofinjured parties and compulsory insurance limits.

GREEN CARD SYSTEM

UNIFIED PROCEDURES FOR AN EFFICIENT CO-OPERATION IN ROAD ACCIDENTS

A common agreement adopted by the national insurers’ bureaux governing the relations among them and the rules in cross-border claims handling.

INTERNAL REGULATIONS OF THECOUNCIL OF BUREAUX

General Provisions

Specific Provisions based on green card

Specicific Provisions on deemed insurance cover

INTERNAL REGULATIONS OF THECOUNCIL OF BUREAUX (GREEN CARD SYSTEM)

IV. EU MOTOR INSURANCE DIRECTIVE

Came into force in 2003.

The Directive created a comprehensive system for the prompt settlement of claims regarding victims visiting a foreign country.

A compulsory system.

IV. EU MOTOR INSURANCE DIRECTIVE

Establishment of:

- Compensation Bodies,- Information Centres,- Appointment of claims representatives.

Agreements of cooperation have been signed between Compensation Bodies, Guarantee Funds and Information Centres.

SOME DIFFICULTIES FOR NON-EEA COUNTRIES

- There was no system for protection of visitors.

- Communication problems with victims.

- No response given by insurers to victims or delay in claims handling procedures.

- Difficulties of reimbursement between insurers.

- The Council of Bureaux has taken the initiative to prepare the agreement.

- A limited scope compared to the 4th Directive.

-No Compensation Body or additional requirements.

- Agreement is based on a voluntary basis.

PROTECTION OF VISITORS’ AGREEMENT

- It consists of two parts: Basic and Optional Agreement.

- The Agreement can be signed bilaterally only between two Bureaux.

PROTECTION OF VISITORS’ AGREEMENT

Exchange of information between two Bureaux to assist a victim:

- Identifying the relevant insurer based on plate number.

- Obtaining police reports.

- Informing victims about Gurantee Funds in case of uninsured or unidentified vehicles.

BASIC AGREEMENT

- An opportunity for an insurer to appoint a claims representative in a foreign country to handle claims arising out of accidents which occur in the insurer’s country of establishment.

- The insurer is free to choose which claims representatives it will appoint.

OPTIONAL AGREEMENT

- Claims representatives have to strictly follow the instructions of the insurer.

- The applicable law is the law of the country of accident.

- Claims representatives act as an intermediary between the victim and the liable insurer.

OPTIONAL AGREEMENT

- Claims representatives can not make any decision on liability,settlement and/or make any interpretations related to the compulsory MTPL insurance legislation in the country of the accident.

- Only after they receive the money and approval to pay from the insurer, claims representatives will make compensation payments to victims.

OPTIONAL AGREEMENT

FINANCIAL DISCIPLINE FOR THE GREEN CARD SALES –

THE DANGER OF A LOW PRICE

Unlimited cover for bodily injuries in some countries+low price = huge risk

Solvency Issues

Bureaux standing as guarantors

Bad image and monitoring in case of delays or non-payment

FINANCIAL DISCIPLINE

GREEN CARD VALIDITY VERIFICATION WHEN TRAVELLING ABROAD

Border Checks

Police Checks

Procedure to confirm green card cover

Fake Green Cards

GREEN CARD VERIFICATION