On Friday the 19th February 2021 UK Transport Secretary, Grant Shapps, announced that he was shelving the “over the top” EU rules that would have required ride on mowers, golf buggies and mobility scooters to be insured in the same way as an individual's private car.
The same EU rules also captured the motorsport sector requiring an on track collision involving vehicles from go karting to F1 to be treated as a regular road traffic accident subject to Road Traffic Act legislation. These rules would also apply to an individual enjoying a non-competitive track day.
The Vnuk law arrived through a 2014 ruling by the European Court of Justice (ECJ) and is named after a Slovenian man who suffered injuries when he was knocked off a ladder by a tractor trailer on a farm.
Mr Vnuk sued the farmer and his motor insurer for compensation for the injuries sustained in the accident. The farmer's motor insurer denied liability and the matter travelled through the Slovenian legal system and finally was heard by the ECJ. The ECJ found in favour of Mr Vnuk. The judgement handed down interpreted the European Motor Directive in a way that was at odds with the UK Road Traffic Act. Until this point the UK Government believed that our Road Traffic Act legislation was in compliance with the European Motor Directives.
This judgement established that all powered vehicles being used for any purpose at any location would be subject to this interpretation of the law and that the UK Road Traffic Act required amendment to be compliant. Had the UK not amended our legislation then the UK Government could be liable to compensate an individual injured within the new criteria established by the ECJ judgement.
The UK Government, motoring organisations and insurers were all surprised and disagreed with the judgement. However, the UK Government had no option other than to set in motion work to amend UK legislation so as to comply with the ECJ interpretation of the European Motor Directive.
This work has been ongoing for several years and included an extensive public consultation in 2016 – full details can be found here
This is a very technical document in part completed by the Governments Actuary's Department but there are some simple outcomes.
Officials said that implementing the law would cost the UK insurance industry £2 billion every year with the cost being passed on to the public through higher motor premiums – this equates to every motor insurance premium increasing by £50 per year.
The Motorsport industry would have faced additional insurance costs of approximately £485 million every year with the potential to collapse the industry and the loss of hundreds of thousands of jobs.
The insurance industry already provides insurance protection to individuals and business for their legal liability outside of that prescribed within the Road Traffic Act.
In announcing this change Mr Shapps said: 'We have always disagreed with this over-the-top law that would only do one thing – hit the pockets of hard-working people up and down the country with an unnecessary hike in their car insurance.'
We can all agree that no one wants to increase the cost of their motor insurance premium
Lockton Performance can provide insurance protection to club members who wish to take their cars on club track days. As part of an annual policy we will insure damage to your vehicle subject to a 10% excess and uniquely will also provide you with third party liability insurance with an indemnity limit of £2 million. This extension to our annual policy is provided at no additional cost but is subject to individual underwriting and written agreement from us.
To obtain a quotation for your motor insurance call 0203 504 6793