New EU insurance rules benefit motorists

12.00.00am GMT Fri 14th Jan 2005

The European Parliament has approved legislation that will give victims of motor accidents a new European right to make a claim in their home country when they have an accident in another EU Member State.

Liberal Democrat MEP Baroness Sarah Ludford said:

"This will end the current situation where if a British driver suffers a car accident abroad they have to negotiate two different legal systems - one of them entirely unknown to them - which can mean a lot of red tape."

"The new right to sue the guilty party's insurers at home is a big step forward for freedom of movement in Europe. As citizens as well as consumers in the EU single market, it is only reasonable that motorists should have a simple procedure for legal action in a cross-border case."

Under the current system, claimants have to deal with two different legal systems, leading to delays, complications and extra costs when trying to claim back expenses.

The new system will mean victims are able to bring a claim against the other party's insurance company directly in their home country, doing away with the need for two sets of lawyers and foreign legal proceedings.

The European Commission has also agreed to look into making insurance companies provide automatic coverage for legal costs involved in accidents abroad. Such cover is already offered optionally by many insurers at a cost of £10 - 15 per year.