In the second article on motoring abroad Roy Rodger continues his explanation of the Green Card system
A large number of European countries have now agreed that the Green Card, which shows that the driver is insured for third party risks, is no longer necessary.
The national vehicle registration plate of the country of origin is sufficient evidence that the the driver has the minimum insurance cover to satisfy the law of the country where he is driving. These states are members of the Multilateral Guarantee Agreement (MGA).
Since the UK joined the EU in 1972, motor insurance policies issued by UK motor insurers and other participating member's insurers have had to provide cover throughout the MGA area.
This cover, however, is only the minimum cover, which is defined as the greater of either the minimum cover required by the country being driven in, or the minimum cover required by the country where the driver lives.
In other words, it is less than third party only and not much use to the driver who wishes to take his new car abroad.
Important features of this cover (limited though it is) are:
This makes the motor insurance policy a truly European policy, consistent with the single-state concept of the EU, permitting freedom of movement between territories.
Most motorists, however, ignore this cover. As stated above, it is not a cover suitable for anyone with a reasonably expensive car who wishes to travel abroad.
In this case, motorists wishing to go abroad, ask their insurers for their UK cover -typically comprehensive or third party fire and theft - to be extended while abroad.
They will then receive a foreign use endorsement. This extends their current policy cover to include the territories being visited, for an additional premium. For cover more extensive than the minimum, the insurer could make a charge or restrict cover. For example, it could impose an additional excess or restrict drivers, but it cannot modify the minimum compulsory cover.
Usually, any extension of cover would include transit of the vehicle by rail, sea, and sometimes air, between the territories covered.
A Green Card is evidence to foreign officials that the motorist has motor insurance which satisfies the law of the country he is visiting. As we have seen earlier, Green Cards are not required in MGA territories (see table).
But, the most common misconception about driving abroad is that a Green Card is needed to extend an existing policy.
A Green Card only confirms what cover there is already on the policy. For example, MGA minimum cover, or minimum cover beyond MGA territories if the policy has been endorsed. A Green Card is not an endorsement and does not affect the policy cover.
A number of insurers now print a message on their certificates of motor insurance in French, German, Italian and Spanish, stating that the policy provides the minimum compulsory cover in MGA areas. The intention of this is to give the customer that extra bit of reassurance where a Green Card is not issued.
This reduces costs and administration for insurers as they found it expensive and time consuming to spend all summer issuing Green Cards.
Some drivers still insist on a Green Card, even if they are going only to MGA countries. Where they cannot be convinced that it is unnecessary, insurers will issue a Green Card. Where they do, it must be in the prescribed format and for a minimum of 15 days, even in the MGA area, where Green Cards are not necessary. An incorrectly drafted Green Card could create difficulties for a motorist as officials are used to a standard format.
If a Green Card is issued for one EU country, it must be made valid for all EU countries (they are all named in the box on the Green Card). Similarly, it is recommended that all MGA countries are also validated.
There is no charge for issuing a Green Card. Insurers may charge for increasing the cover, extending the territorial limits beyond the MGA area, or for lengthening a period of free foreign use. Brokers, however, are entitled to make a service charge for obtaining a Green Card for their clients.
The reduction in Green Cards has saved insurers a lot of work, but they still have to issue foreign use endorsements, where the motorist wanted wider cover than just the minimum, or wanted to travel outside of MGA countries. Consequently, most insurers now build into their standard policy wordings a reasonable level of free foreign use, for example, 14, 25 or 60 days per year, for travel to MGA countries.
The actual number of days may vary between insurers and between brands, but the territories are always in the MGA area to tie in with the compulsory cover.
If you are going to a country that is not in the Green Card system, such as Belarus, Lithuania or Russia, it is advisable to contact the relevant embassy or consulate to get an update before leaving .
In many cases, it is possible to buy insurance at the border, but this may be expensive and restricted. There are brokers who have contact with insurers who are able to write motor business in these territories and they may be able to obtain a short period cover. N
MGA countries (where no Green Card or bail bond is necessary)
France (inc Monaco)
Italy (inc San Marino and Vatican)
Portugal (inc Madeira)
Spain (inc Canary Is)
Other MGA countries
Some countries of the former Yugoslav
Federation are now included in the MGAarea. These are: Slovenia and Croatia
But a Green Card is required for Bosnia-Herzegovina and Macedonia
Applications to the embassies of Montenegro and Serbia are required before travel there
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