ILC ARTICLE

UK ditches EU motor insurance law

26th April 2022

The UK government is scrapping an EU law that could have seen motorists face an annual £50 hike in motor insurance costs.

Parliament has this week passed a bill to scrap the EU’s Vnuk motor insurance law, which stipulates that drivers must have motor insurance for vehicles other than cars and motorbikes. This includes golf buggies, mobility scooters and quad bikes, and could have been enforced even on private land.

It is estimated that scrapping Vnuk could save the insurance industry up to £2bn a year.

Transport Secretary Grant Shapps said, “Sacking this nonsensical EU rule will protect the pockets of hard-working British people. I’m delighted this bill has rightfully passed through parliament, saving billions of pounds of additional insurance costs and protecting our world-leading motorsports sector.”

The decision has been welcomed by the UK motor insurance industry.

James Dalton, Director, General Insurance Policy, Association of British Insurers, said, “Common sense has prevailed and we welcome the government’s scrapping of this unnecessary and unenforceable requirement. Monitoring compliance and enforcement for those using vehicles on private land, as well as establishing the circumstances of any claim, would have been fraught with difficulties and risked increasing fraud which would ultimately end up being paid for by motorists through their insurance premiums.”

Meanwhile, Dominic Clayden, CEO at MIB, said, “We have campaigned on this issue for a number of years and we’re delighted that the necessary legislation to remove the effects of Vnuk has now passed. Motorists will no longer be faced with the additional costs, relating to future accidents on private land and accidents involving a range of extra vehicles – including lawnmowers and golf carts. This will save all motorists money and take us back to the common-sense approach we had before the Vnuk ruling in 2014.”