Commission considers significant European support for Motor Insurance Directive change

As we mentioned in two recent Vnuk blogs the European Commission has picked up the pace in considering the issues that arise both in respect of that judgment but also in respect of the Motor Insurance Directive. Whilst a broader consultation closes in October a narrower Inception Impact Assessment consultation closed this week with 20 substantive responses. There are two Government responses (UK and Ireland) with British, French, German, Irish, Spanish and Maltese insurers responding through member organisations such as the ABI. Additionally the Council of Bureaux, the Secretariat for 47 National Guarantee Funds (the European MIBs) has also responded on behalf of its members. Motorsport responses are also strong with two from the UK and one from Ireland, again responding collectively on behalf of members. All of the above favour the “in traffic” amendment to the Motor Insurance Directive to reflect a narrower compulsory insurance obligation than is implied by the Vnuk judgment itself (save for the French Insurance Federation which takes the view that its compulsory cover already includes Vnuk).

The contrary case in respect of Vnuk is presented by three lawyer lobbying groups: APIL, FOCIS and PEOPIL. The first two are broadly representational of UK legal firms but the latter has a much broader Pan-European (an indeed wider global) membership.

A narrow reading of “for” and “against” is dangerous on a technical issue and responses, even of those arguing for the ‘full Vnuk’ accept that there should be exceptions. The weight of insurer responses and particularly that of the Council or Bureaux should, one would hope, carry significant weight with the Commission. The very clear concerns of motorsport about the existential threat posed by the ‘full Vnuk’ are articulately expressed and broaden to include reference to other European treaties and societal considerations.

There is an ongoing debate about the issue and further work to be done. The wider consultation on MID does not close until 20 October and there will be further opportunity to reinforce the arguments about the scope of MID and Vnuk in those submissions. BLM is hosting a workshop on the subject on 25 September and is happy to welcome interested parties.


 Written by Terry Renouf, consultant at BLM

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