Britain’s car insurance industry could soon provide greater protection for consumers and increased standardisation across the industry after the EU announced a range of new proposals.

If approved, the rules would standardise the format and application of insurance histories, as well as set minimum levels of cover in all EU countries.

EU Flag

The five proposals announced by the European Commission include:

Insurer insolvency

If an insurance company goes out of business, insurance policies will still pay out. This protection is already in place in the UK, but it will now benefit motorists throughout the EU.

Insurer Insolvency image

Claims history statements

Insurance histories from all EU member states will be accepted and treated in a universal manner.

Claims history statements

Uninsured driving

In the UK, it is illegal to drive without insurance, and proposals from the EU means that states will have greater powers to combat uninsured drivers and use number plate recognition systems to check the insurance status of cars from other EU countries – which is currently prohibited as a hindrance to free movement.

Unisured driving

Minimum amounts of cover

Another change will harmonise the minimum levels of cover EU citizens will experience across the EU. As it stands, cover levels differ across member states.

minimum level of cover


The EC wants to clarify what “normal use of a motor vehicle” entails from an insurance perspective. That includes how claims should be handled for accidents that take place on private land, or in agricultural settings.

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Jyrki Katainen, the European Commission’s vice-president for jobs, growth, investment and competitiveness, believes the changes would ensure the “smooth functioning” of the insurance industry “for the benefit of drivers and potential victims of motor vehicle accidents”.

The British Insurance Brokers’ Association (BIBA) is onboard with most of the proposals but expressed concern universal insurance histories would “create an administrative burden, [and] significant IT system changes”, adding cost to a system “that already works well in the UK”.

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