In response to a recent review of the European Motor Insurance Directive (MID), the International Underwriting Association (IUA) has called for the MID to not be extended to include liability for accidents on private property.
Commenting on a review of the MID, the IUA states that protection provided via the legislation can only be “effectively applied and enforced” on public roads, warning that extending the MID to include vehicles used on private land, such as tractors, mobility scooters and so on, would result in fraud and uninsured driving.
The MID calls for all vehicles to be insured for third party liability, but that certain types can be excluded by EU member states. However, a recent European Court of Justice ruling stated that an accident caused by a tractor on private land should be covered by the directive, which has led to some confusion about the implementation of the law.
“In most EU member states there are well established employers’ liability insurance regimes that already adequately cover accidents on private land. The complexity of extending the current motor insurance regime to many millions of additional vehicles would risk reducing the accountability of employers or event organisers as they may seek to pass responsibility onto individual drivers,” said Chris Jones, IUA Director of Market Services.
“It would also be difficult and costly to enforce. Speed cameras, spot-checks and automatic number plate readers have helped to greatly reduce the number of uninsured drivers, but how effective could they be on private land?
“Furthermore, increased levels of fraud and non-compliance, rising claims volumes and additional calls on the Motor Insurers’ Bureau would all, inevitably, pressure premium rates across the motor insurance and reinsurance market,” he continued.
In response to the European Commission, the IUA did recognise that people involved in such accidents do deserve compensation, but stressed that other legal mechanisms can be used for this.
