Green card system for UK-based motorists: implications for insurers

Until and unless the European Commission confirms the UK’s continued participation in the Green Card Free Circulation Area (GCFCA), from 1 January 2021 all UK-based motorists will need to be issued with a ‘green card’ when driving abroad in any of the 30 European Economic Area (EEA) countries, as well as in Andorra, Bosnia and Herzegovina, Serbia and Switzerland.

Green cards simply provide evidence that a UK registered vehicle has the necessary minimum compulsory insurance required.

Motorists will need to carry a physical green card with them for presentation at borders or at police checks. However, insurers are permitted to electronically send the green card to policyholders to print on plain white paper. The Motor Insurers’ Bureau have issued very clear guidance on how the green card should be laid out which can be found here.

It is important to understand that multiple green cards may be needed in certain situations such as:

• Fleet or multi-car insurance (a separate green card is required for each vehicle).
• A vehicle towing a trailer or caravan will require a green card for the towing vehicle and one for the trailer or caravan (along with possible separate insurance for the trailer or caravan).
• Where a policy will renew during the policyholder’s trip (a separate green card will need to be issued under the old and new policies).

All green cards are deemed to be valid for at least fifteen days from their date of inception. There is no maximum period - that is down to an insurers’ discretion.

Comment

Insurers need to make sure that their policyholders (and in particular fleet policyholders) are aware of this new requirement, and also the procedures for requesting a green card from insurers, including the likely timescale for doing so. Reminders will need to be regularly issued, particularly as many non-commercial policyholders are unlikely to be driving abroad for some months, particularly whilst COVID-19 lockdown restrictions are in place.

The new arrangements may lead to some uncertainty amongst motorists as to the requirements and so important considerations for insurers will include ensuring customer service staff are equipped to answer queries, and online guidance is clear and kept properly up to date.

If a motor policy is subsequently cancelled, but a green card was issued at inception or renewal for the policy period, there is no obligation on insurers to retrieve the green card. However, a note of caution, as the green card is a stand-alone document, if insurers fail to retrieve it and the policyholder/driver produces it following an accident, insurers could be deemed liable to provide cover for the accident.

Related item: Jurisdiction in civil claims post-Brexit