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Your Vehicle and Brexit - What Changes?

The United Kingdom officially departed from the EU at the end of January 2020, marking the beginning of the transition period that ended on December 31st the same year.

With trade deals being agreed upon, there are many aspects of the UK-EU relationship that will be impacted. Today, our concerns divert towards the general insurance industry in the UK, specifically car insurance.

As January 2021 began, many UK drivers and car insurance holders wondered how their policies and insurance will change.

Green Card to Drive in the EU

The first and most prominent change all car insurance holders will now need to carry a green card to drive around the EU and countries including:

These green cards also referred to as International Motor Insurance Cards, are proof that you’re carrying at least minimum coverage. It allows you to drive legally in a country outside of the UK and between Northern Ireland and the Republic of Ireland.

Motorists can obtain their green cards from their insurers by applying for one. A minimum six-week waiting time is necessary for the insurer to review the motorists’ application. This means that you’ll need to plan your trip accordingly.

Also, motorists will need a green card for every vehicle they’ll be taking outside of the UK – and not per policy. Even if drivers carry a multi-vehicle policy, they’ll need to apply for a green card per vehicle.

The change in rule also impacts motorists driving a trailer or caravan along with their primary vehicle. In this case, the driver will need to apply for two green cards, one for the car and one for the caravan/trailer.

In most cases, insurers provide green cards free of charge but some may cost the applicant a small admin fee.

Drivers may also be required to get an old-school Great Britain sticker for their vehicle when they take it beyond UK boundaries.

What about the cost of car insurance?

While the green card, as a certificate of insurance, is a change ready to be implemented, the question regarding a change in the cost of car insurance in the UK comes up as well.

There is an assumption that during negotiations, certain tariffs will be imposed on imports and exports made between the UK and members of the EU. Increased charges being levied as tariffs would mean expensive car insurance policies.

Insurers would have to factor in the cost of importing cars and car parts, repairs, and replacement of vehicles in the policy.

However, the current situation dictates – in broad terms – that the UK might obtain a tariff-free agreement. This means that, for the time being, the price of car insurance in the UK will not be impacted by a change in tariff considerations.

The other way car insurance in the UK might look different post-Brexit is in terms of how premiums are charged currently. After the complete transition, the UK is not required to adhere to directives imposed across the EU.

For example, policy providers in the UK can now go back to charging increased premiums for male drivers, neglecting the EU Gender Directive (2012).

Besides this, it will be very interesting to see the further changes to come and how the UK car insurance industry shifts as the UK adjusts post Brexit.

Writen by: Anthony Brooks on 2021-03-16

Tagged under: Insurance, EU.


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