On 21 February 2021 the UK Government announced it will not be following the Court of Justice of the European Union (CJEU) decision in Vnuk v Zavarovalnica Triglav dd , and so will not be extending compulsory motor insurance requirements to the use of a wider range of vehicles, including usage in areas where the public do not have access.
Pre-Brexit, Article 3 of Directive 2009/103/EC (Sixth Motor Insurance Directive) required Member States “to ensure that civil liability in respect of the use of vehicles normally based on its territory is covered by insurance”.
Post Brexit, the compulsory insurance requirement is retained through Sections 143 / 145 of The Road Traffic Act 1988 (the Act) which requires insurance policies to cover the use of vehicles “on a road or other public place in Great Britain”, but not areas where the public do not have access. The Act also defined vehicles as those which are mechanically propelled and intended or adapted for use on roads.
The case of Vnuk involved an accident in Slovenia, where the claimant was injured when a trailer attached to a tractor being driven on a farm (private land), struck the ladder he was using, causing him to suffer injury. The concept of “use” was interpreted widely by the CJEU to include “any use of a vehicle that is consistent with the normal function of that vehicle” (so included non-road motoring activities). The CJEU also made clear that the concept covers the use of a vehicle on public or private land.
Following Vnuk, several cases heard in England and Wales (for example MIB v Lewis ) found our domestic law concerning compulsory motor insurance, was not consistent with European law. The European Commission and European Parliament are looking to amend the Motor Insurance Directive as it applies across the remaining Member States, to better reflect the decision in Vnuk and it had been widely thought that the UK Government would follow suit.
The government’s decision maintains the ‘status quo’ and will be generally welcomed by insurers.
Had the decision in Vnuk been implemented into UK law, a further class of vehicles could have fallen within the scope of compulsory insurance requirements, such as motor sports vehicles, industrial vehicles, off road quad bikes, golf buggies, and ride on lawnmowers. It could also have led to insurers facing a new range of fraudulent, staged accidents, particularly where the circumstances may have made investigation more difficult and the absence of independent witnesses perhaps more likely.
Enforcement and monitoring of the potential new compulsory insurance requirements would also have been near impossible. The government’s decision is also likely to be welcomed by the MIB (and thus insurers via the levy), which following the decisions in Vnuk and Lewis, had been left open to claims resulting from accidents on private land, involving a range of vehicles which previously insurance was not required for.
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- Green card system for UK-based motorists: implications for insurers
- Uninsured road accidents on private land – Supreme Court rejects application by the Motor Insurers’ Bureau