Motor Insurers’ Bureau’s announcement to insurants concerning MTPL Insurance policy validity in all countries of the European Economic Area


After May 1, 2004, when then new Law on the Compulsory Third Party Liability Insurance for Inland Motor Vehicle Owners (henceforth – Law) came into force, in the Latvian market offers have surfaced to buy MTPL Insurance policies that are only valid in the territory of the Republic of Latvia, alongside with concluding of agreement that restricts the policy’s validity territory.

The abovementioned agreement is concluded in conflict with the MTPL Insurance Law and EU Directives. In this connection the Motor Insurers’ Bureau on behalf of its member makes the following announcement:
– The amount of the MTPL (OCTA) Insurance premium (policy’s price) determined by the insurer and indicated on the policy has to ensure the fulfilment of all liabilities stipulated by the insurance agreement;
– Any MTPL Insurance policy issued by any Insurance Company licensed in Latvia is valid in all countries of the European Economic Area without any territorial restrictions in its indicated validity period;
– The insurer has no rights to demand any supplementary pay if the insurant leaves the territory of Latvia with a valid insurance policy;
– The insurer is not entitled to conclude any supplementary agreements or contracts with the insurant that the vehicle indicated in the policy will not be used outside the territory of Latvia, or placing any supplementary obligations on the insurant concerning the use of the vehicle outside the territory of Latvia;
– The Law neither entitles the insurer to receive information from the insurant concerning his vehicle leaving Latvia during the validity period of the policy nor obliges the insurant to deliver any such information;
– The Law allows a breach of the MTPL Insurance contract prior to its expiration only in the following cases:
1. if the vehicle is expropriated;
2. if the vehicle has left the owner’s, holder’s or user’s possession not due to his fault but due to another person’s illegal actions and this fact is reported to the relevant law enforcement institutions as it is prescribed by normative acts;
3. if there is a mistake in the information indicated on the policy;
4. if a legal entity is liquidated or its title is changed;
5. if the vehicle will not be used in the traffic and the insurant has handed in a written application for a breach of the Insurance contract prior to its expiration.

If you have questions concerning the conclusion of MTPL Insurance agreements or your insurer fails or has failed to comply with one of the conditions mentioned in this announcement, please address your questions to the Motor Insurers’ Bureau of Latvia in Rīga, 9 Lomonosova street, call us at +371 7114 300 on weekdays from 8:30 am till 6:00 pm, or send us your questions by fax +371 7114 333 or by e-mail PDF

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