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Select Committee on European Union Minutes of Evidence


Supplementary evidence from Association of British Insurers (ABI)

 (Note prepared by the Motor Insurers' Bureau (MIB) covering the questions raised on the Council of Bureaux)

  Q376  The Council of Bureaux (CoB) has 44 member bureaux including all European states west of the Ural mountains and the Caspian Sea with the exception of Russia and the three Caucasus Republics. Russia and Georgia are currently negotiating with the CoB to become members.

  Q378; Q379; Q380  The Green Card System is not advertised to the general public. Neither it is believed do individual national bureau advertise their existence. However motor insurers and motor claim lawyers in Europe have 50 years' experience of the operation of the system and it is very well known to them. Claims are settled after the insurer or lawyer of the victim of an accident makes contact with the insurer of the vehicle responsible for the accident, whether the vehicle is domestic or foreign. Settlement takes place under the law of the country of the accident. In the relatively rare cases when this does not happen within a prescribed time-limit then the Council of Bureaux rules take effect and the claim will be paid by the bureau in the country of the accident and the claim will be reimbursed by the bureau of the country of the vehicle held responsible for the claim.

  Q381  All countries initially joining the system are required to provide a Green Card as proof of motor insurance cover when traveling abroad. In some countries such as France and Belgium the Green Card has been incorporated as the domestic proof of the existence of a valid motor insurance policy for the vehicle. Within the European Union the specific requirement for a Green Card no longer exists as under the 1st Motor Insurance Directive 1972 all vehicles within the European Union are deemed to be insured on the basis of the existence of their national registration plates and do not require documentation to prove the existence of valid motor insurance cover. It is apparent that the level of consumer understanding of the existence and functioning of the Green Card system has reduced in those countries where the Green Card is no longer required and this is a particular problem in Western Europe apart from Belgium and France. However, in practical terms it is not necessary for people to be aware of the existence of the system, it simply functions in the background and it is recognised as a practical effective claims settling mechanism by the United Nations Economic Commission for Europe, the European Commission and the national authorities of the countries in which the Green Card system operates.

  Q382; Q383; Q384  As far as hire vehicles are concerned they operate and are insured under the national laws of the country in which they are registered. A third party accident caused by a hire car either domestically or abroad would be treated in exactly the same way as an accident caused by any other vehicle from that country.

  Q386, Q387  Over the years practical rules have been developed within the Green Card system for most, if not all, combinations of third party liability accidents involving vehicles registered in different countries. The bureau system guarantees the reimbursement of all claims occurring under existing Third Party Motor Liability legislation in all member states of the European Union as well as the third country members of the Green Card system.

  Q388  Because most accidents involving foreign vehicles are settled within the European Union under the normal procedures of inter-insurer relations the Council of Bureaux has no accurate data on the total number of accidents settled under the Green Card system. Our best estimate is based on a the annual CoB survey of bureaux statistics. The latest (2004) survey showed that across Europe approximately 300,000 accidents a year are settled under the Green Card system. The proportion of claims that are claims that are below the

2,000 ceiling proposed for the European small claims procedure are not known. The attached table of average MTPL (motor third party liability) claims in selected countries of the European Union, published by Swiss Re may be of interest (not printed with this Report).


 
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