Compulsory motor insurance reform

The government is consulting on motor insurance reform that would minimise the impact of the 2014 European Court of Justice (ECJ) ruling in Damijan Vnuk v Zararovalnica Triglav (C-162/13).

Vnuk concerned a farmyard accident involving an uninsured tractor on private land in Slovenia. The ECJ found that the tractor should have been insured.

According to the Forum of Insurance Lawyers (FOIL), the decision potentially means compulsory insurance would be required for everything from racing cars to mobility scooters, quad bikes and golf buggies. It is backing a proposed amendment by the Department for Transport to the Motor Directive, which would extend the categories of vehicle in the compulsory insurance regime but only apply where the vehicle is being “used in traffic”. The consultation, Motor insurance: consideration of the ‘Vnuk judgment’, closes on 31 March.

Peter Allchorne, partner at DAC Beachcroft and FOIL spokesman, said FOIL supported the proposed amendment but recognized it was “not a panacea for the issues raised by Vnuk”.

Writing in NLJ this week, however, solicitor and motor insurance specialist Nicholas Bevan says Vnuk is “not quite the ‘game changer’ the consultation paper professes it to be” since it does not contain any new EU law principles. Bevan says the consultation fails to consider whether the insurance industry provides value for money.