Accidents occurring in the EU

EU law has made elaborate provision for ensuring that the victim of a motor accident secures compensation for his injuries. There have been five EU Directives, recently consolidated in the Sixth Motor Insurance Directive, European Parliament and Council Directive 2009/103/EC. The primary mechanism for this is compulsory insurance. However, if the driver is not insured, the victim has a claim against a compensation body; in the UK that body is the Motor Insurers’ Bureau. Under EU legislation the MIB is also required to meet a claim brought by the UK-domiciled victim of an accident occurring elsewhere in the EU where the wrongdoer was uninsured. InJacobs v Motor Insurers’ Bureau [2010] Lloyd’s Rep IR 244 the question was whether a claim against the MIB in such a case is to be measured under English law or under the law of the EU state in which the accident occurred. Owen J has opted for the latter.

The legislative framework

The regime for compensating the victims of drivers in cases with a cross-border element where the accident occurs within the EU is set out in the Fourth Motor Insurance Directive, European Parliament and Council Directive 2000/26/EC. This builds upon the compulsory insurance requirement established by the first three Directives. As is well known, the Directives also require each member state to establish a compensation body, which is to compensate the victim if the driver himself is uninsured or untraced. The UK had established such a mechanism, in the form of the MIB, as early as 1946, but only in respect of uninsured drivers, extending the scheme to untraced drivers in 1969. The Fourth Directive is concerned primarily with accidents involving insured drivers, and requires every insurer to establish a claims representative in each EU member state so that a victim injured anywhere in the EU can seek compensation from the insurer in the victim’s home state. If the insurer does not make payment or if the driver is uninsured the victim is entitled to seek compensation from his home state compensation body. Having made payment, the home state compensation body has a subrogation claim against the compensation body in the member state where the vehicle was registered or, if unidentified, where the accident occurred. The operation of the scheme as between national compensation bodies is embodied in the ‘Agreement between Compensation Bodies and Guarantee Funds’ of 29 April 2002, to which the MIB is a party.