How will Brexit affect car and motorbike insurance?

How will your motor insurance be affected when Britain leaves the EU?

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The biggest impact Brexit will have on car and motorbike insurance is when a driver takes their car or motorbike to Europe. Brexit won’t mean you’ll need any additional or different insurance, but you’ll need extra paperwork relating to the insurance you have in place. 

All UK vehicle insurance provides the minimum third party cover to drive in other EU countries – but post-Brexit you’ll need a green card to prove this. A green card is an international certificate of insurance, issued by UK insurers, guaranteeing that you have the necessary minimum motor insurance cover for driving in the country being travelled to.

If there’s no deal, the Association of British Insurers (ABI) says drivers will need to carry a physical green card while driving their vehicle in the European Economic Area (EEA) and some other countries (Andorra, Serbia and Switzerland). Digital green cards won’t be accepted.

(Note that you won’t need a green card if you’re hiring a car – you should be covered by the rental company’s insurance.)

You won’t be issued with a green card automatically, and will instead need to apply for one. The ABI recommends that you apply for your green card at least a month before you travel, to give insurers enough time to process the request and post you the card.

If you don’t have a green card in the event of a no-deal Brexit, the ABI says you could be breaking the law and you could be fined, prosecuted or have your vehicle seized. Alternatively, you will need to buy car insurance while you’re abroad, but this may be more expensive or unavailable.

You’ll need a green card per vehicle, not per insurance policy, so if you have a multi-vehicle policy you’ll need a green card for each car you take to Europe. If you are travelling with a trailer, some EU and EEA countries may also require a separate green card as proof of insurance for your trailer. So you’ll need to contact your insurance provider to get two green cards: one for your car, and one for the trailer.

Green cards are currently issued free-of-charge, but it’s possible that insurers will introduce an admin fee to issue the document. 

Currently if you’re injured in a road traffic accident abroad, you can return to the UK and pursue a claim in the UK either via a local representative of the foreign insurer, or a special “compensation body”. The Motor Insurers’ Bureau (MIB) is the compensation body for the UK.

But after Brexit if you have an accident caused by another driver abroad, you may need to bring a claim against either the driver or their insurer in the country where the accident happened. This may involve bringing the claim in the local language which will obviously come with complications and probably expense (i.e. to pay for a translator if you’re not fluent in the other language).

There is another way Brexit might affect car and motorbike insurance premiums. The EU Gender Directive was introduced in December 2012 and made it illegal for insurance companies to discriminate by gender.

Before this date, insurers tended to charge men more for car insurance as they tend to have more, and higher cost, accidents. Post-Brexit, the UK will be free to scrap that law, leaving insurers free to increase premiums for male drivers once again. However, this type of thing is probably quite far down the Brexit to-do list.

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