The need for green cards could potentially see insurers having to hike administration costs
UK drivers have been warned they might need “green cards” to drive in the EU if there is a no-deal Brexit.
Drivers heading to the continent might require green cards issued by insurance providers to hire and drive in the EU on top of a full driver’s licence to guarantee the motorist has necessary cover.
At present green cards are issued free-of charge but due to the potential need of it in a no-Brexit deal, insurance providers could decide to reflect production and handling costs with increased administration fees.
Earlier this month the Department for Transport (DfT) published a series of six technical notices setting out plans for a no-deal Brexit. The industry has responded to its guidance on “Vehicle insurance if there’s no Brexit deal.”
In this document the DfT said that negotiations are “unlikely” and it is continuing to seek a “positive deal”, but it laid out guidance for UK driving licence holders in the event of a no deal scenario.
It said that UK driving licences may no longer be valid in the EU without a green card.
But DfT said that for private and commercial motoring it is seeking a deal for UK motorists to continue driving in the EU without additional checks.
Keeping the UK in the EU’s car insurance zone
The Association of British Insurers’ (ABI) director of regulation Hugh Savill, said: “The Government and motor insurance bodies across Europe have already agreed a plan to keep the UK in the EU’s car insurance zone – the timeframes simply need rubber-stamping by the European Commission.”
He said that the ABI hopes that “the Commission gets on with this as soon as possible to protect motorists and haulage operators,” in the UK and in Europe, from the unnecessary hassle and cost of having to return to a Green Card system.
Green cards could hike administration costs for insurers
The AA echoed this warning that with a no-deal Brexit, the country faces travel restrictions that go straight back to the 1960s.
Janet Connor, AA’s director of insurance highlighted that currently drivers can cross the channel and drive where they wish within the EU using a valid and EU-compliant driving licence and passport.
She said: “Drivers would need to remember to obtain their green card from their insurer prior to their departure, otherwise they run the risk of picking up a fine.”
She pointed out that 7m drivers go to Europe for business or pleasure each year but speculates whether the need of an insurance green card might bring a “greater administrative burden and cost on insurers.”
She said: “The hard Brexit facts are that it could bring back the long-forgotten requirement of an insurance ‘green card’, last needed decades ago. At present that proof of insurance is not legally required although it is advisable to take a print-out of your insurance certificate with you.”
Connor said that whilst the same rules would apply to Europeans driving in the UK, she highlighted that “no detail has been given about how the documents would be checked.”
She added: “The Government has made it clear that they will not check items at the border, so it needs to declare who will check them and where.
But she said: “This is on top of the potential need for an International Driving Permit (IDP) of which there are two types in different European countries.”
Connor said that the extra administration is an “inconvenience for drivers but for the industry and small businesses” as “it potentially adds a further layer of bureaucratic difficulty to cross-border trading.”
She added: “From what was an easy and simple process of driving on to the Continent, driving your own car in Europe could become a real pain.
“Overall, a no deal Brexit would mean more hassle than the current arrangements, so we hope a deal can be struck to avoid this potential red tape.
“And while there is no immediate change, it’s important for anyone planning to travel with their car on or after 29 March 2019 to check with their insurer.”
UK insurers have been proactively seeking to cushion the impact in their businesses of the UK leaving the EU without an agreement in place.
Earlier this month the international trade secretary, Liam Fox suggested that there was possibly a 60% chance that the UK will fail to negotiate a satisfactory trade agreement or transition period before March 2019.
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