Picture the scene. It’s an idyllic Sunday afternoon and you decide to go out for a drive. That drive starts in Northern Ireland and takes you along part of the 310 miles that is the border with the Republic of Ireland, probably onto one of the 270 plus roads that crosses the border (possibly more than once). You aren’t really paying much attention to where you are, in fact there are no signs up indicating where you are. You are driving along an incredibly porous border crossing back and forth between Northern Ireland and the Republic along your route, possibly on multiple occasions.
Picture another scene. A farmer gets into his tractor at the top of his field, which is in Northern Ireland. It’s planting time and the plan is to drive up and down the field spreading the seeds. Half way down his field the border crosses his farm and so for half of his time he is driving his tractor in the Republic of Ireland.
It is entirely possible that in both scenarios the driver is giving no thought whatsoever to the insurance implications of the border crossing. They should be!
The Motor Vehicles (Compulsory Insurance) Act (Northern Ireland) 2022 (the Act), which received Royal Assent on 26 April and came into effect 2 days later, automatically removes the effect of Vnuk for any accident from that date onwards. Section 145 of the Road Traffic Act 1988 will remain as the correct provision and the impact of retained EU law will no longer apply, such that cover for off road accidents will no longer be required.
The extent of the cover required in Northern Ireland (and the rest of the UK once The Motor Vehicles (Compulsory Insurance) Act 2022 comes into force on 28 June) is limited to a road or other public place. In the EU, the effect of Vnuk remains and minimum cover requirements include cover for off road accidents.
So imagine that on your road trip along the border, you decide to pull off the road into a field for your picnic. Whilst parked in the field your car is negligently struck by the farmer who, having finished spreading the seeds, is on his way back to the barn. At this point, the question of whether you are in Northern Ireland or the Republic is a very pertinent one. If you are in Northern Ireland there is no requirement for the farmer to have insurance cover for an accident that takes place on private land. In the Republic such cover would be a requirement of the minimum cover needed by law.
This is of course an issue for any UK insurer providing driving abroad cover for anywhere in the EU1. It is just more stark for those insurers providing insurance in Northern Ireland where border crossing for some is a routine part of daily life.
It will be necessary to tailor policies so that they work adequately; customers should have at least the minimum level of cover in place in either jurisdiction at all times to ensure that they are covered for the whole of what could be their daily commute. In such a scenario the minimum cover requirements for driving in the Republic should perhaps not be captured within the “driving abroad” section of the policy (where there may be limitations to the number of days you can be abroad) but within the standard cover provided.
Overall the Act works to decrease the insurance risk in Northern Ireland as previously the effect of Vnuk extended the risk to off road, but the importance of the border and the fact that it can be crossed frequently and possibly without the driver’s knowledge as to exactly when it is crossed cannot be overlooked when providing cover to customers.
1The EU is currently looking to revise the Motor Insurance Directive to address the current line of cases stemming from Vnuk. Such any amendment is not expected to take effect before December 2023.
For more information or advice, please contact one of the experts in our Strategic Advisory Team.
