Green Card and Brexit update to Members (Dominic Clayden, CEO)
18 January 2019
Dear Colleagues,
I have written to you previously providing updates on Brexit. Clearly this is a hot topic, and as such I am writing with the latest information. I will of course continue to update you on a regular basis. We held a further Brexit stakeholder event on 15 January to follow up on the 1 October meeting. This meeting was particularly well attended, with several insurers, legal representatives, MIB Ireland, ABI, UK Green Card Correspondents, BIBA, FCA and HM Government (DfT).
As you may recall from my message following the last meeting, discussion on that occasion focused on the risk of a no-deal Brexit and the possibility that insurers may need to issue green cards for all policyholders wishing to travel abroad including to the EU. Following parliament’s rejection of the government’s proposed Brexit deal (coincidentally on the day of our meeting), this issue remains at the forefront of our concerns. Some commentators believe that no-deal is now more likely than ever, not least because exiting the EU on 29 March has been written into UK law.
If parliament cannot either unite behind some version of the deal or agree another way forward (and it is far from clear that a majority could be garnered for any of the options being put forward), leaving the EU without a deal on 29 March is the default position. Added to that, the European Commission has not responded to pressure to set a date for the UK to be included in the green card-free circulation area following its departure from the EU, despite the fact that we have signed the Multilateral Agreement.
One of the participants in our meeting reported that informal signals from the Commission were very negative on this point. It therefore remains imperative for insurers to prepare to issue green cards – and time is now very short. As explained in my last message, for historical reasons green cards must be carried as physical documents. The likely numbers involved and the scale of the operation required to issue them should not be underestimated. As one of the action points agreed at our meeting, ABI will increase its efforts to raise awareness of this issue and the need for any insurers who have not already put arrangements in hand to do so without delay.
The related issue of trailer registration as a result of the UK government’s decision to ratify the 1968 Vienna Convention on Road Traffic was identified as a key area of concern. Commercial trailers above a certain weight will need to be registered and have separate green cards issued for travel to several countries outside the UK. There is some guidance on the GOV.UK website (https://www.gov.uk/guidance/trailer-registration) but our discussions revealed uncertainty about many aspects of how this will be applied, including commercial trailers picked up during travels abroad and domestic trailers and caravans. Insurers need absolute clarity on the requirements and how they will be enforced across Europe (and more widely): their customers who drive across borders will be in the hands of officials and law enforcement officers in each country, all of whom may have different interpretations of the rules. It was agreed that DfT should elaborate on the information already available.
MIB reported on efforts to persuade the Bureaux and Guarantee Funds of EEA states to sign bilateral Protection of Visitors agreements to facilitate the exchange of information if and when the UK is withdrawn from the 2009 Directive arrangements, which allow victims of accidents abroad to make compensation claims in their own country and language. There are two agreements covering victims of insured and uninsured drivers, and we have made good progress in getting them signed; MIB agreed to list the agreements signed on its website and this will happen shortly.
This exercise has revealed that some Guarantee Funds do not compensate non-EEA nationals or residents unless a reciprocal bilateral agreement is in place. If any of these bodies refuse to sign our bilateral agreement covering victims of uninsured drivers (which includes the necessary reciprocity), UK nationals and residents will not be able to claim compensation in the event of an accident involving an uninsured or untraced driver in the country concerned. In such circumstances, MIB would be forced to seek an amendment to its agreements with HMG allowing it to cease making compensation available to residents of the country concerned in the event of their citizens becoming victims of accidents in the UK. We are working hard to avoid this and have no wish to change our current practice of compensating victims irrespective of their nationality or country of residence – but this will only be possible if the other party plays ball.
Participants agreed that the meeting had been useful and that we should hold further meetings 2-3 weeks before 29 March and around a month afterwards. Details and invitations will be circulated in due course. In the meantime, we shall be hosting another Brexit stakeholder meeting in Gibraltar on 24 January.
Regards
Dominic Clayden
Chief Executive