More than 7 million LVL have been paid out for road traffic accidents caused by motor vehicles that have not had MTPL insurance cover

During the period from 2006 till now the Motor Insurers’ Bureau of Latvia (MIBL) has paid 7 397 745 LVL from the MTPL Guarantee Fund. Indemnities from the Guarantee Fund are paid mainly in cases when a traffic accident has been caused by a vehicle without MTPL insurance cover. In such cases the indemnities are paid both for loss caused to the victim’s property and bodily injuries caused to the victim, and the paid amounts are recovered according to the recourse procedure from the owner of the vehicle that had caused the accident.

The total amount paid from the MTPL Guarantee Fund in the first five months of 2011 is 476 674 LVL. Most of the disbursements from the Guarantee Fund have been made in connection with traffic accidents occurred in Latvia; however, in the last year, the number of indemnities paid in connection with traffic accidents having occurred abroad increased up to 20%.

The greatest-ever total estimated amount of the loss caused by a vehicle without MTPL cover payable from the MTPL Guarantee Fund was 247 thousand LVL. The accident occurred in 2008 in Latvia, and currently the amount of 40 579 LVL has already been paid to the injured party, but almost 207 thousand LVL are reserved. But the cost-largest foreign road traffic accident caused by a vehicle registered in Latvia without MTPL insurance cover, occurred in 2006 in Ireland, where already 99 609 LVL have been paid for the damage to property and injuries caused to the victim, but the total amount of indemnity estimated exceeds 204 thousand LVL. Also last year, the cost-largest road traffic accident involving a vehicle registered in Latvia without MTPL insurance cover, occurred in a foreign country - Sweden, and for the damage caused to the motor vehicle and as indemnity for the victim’s intangible losses the MTPL Guarantee Fund paid out 48 717 LVL.

So far, the largest insurance claim to be covered by a Latvian insurance company for an accident caused by a vehicle registered in Latvia in a foreign country, is amounting nearly to 6 million euros.

The MTPL Guarantee Fund is administered by the MIBL, and this Fund is formed by deductions from MTPL insurance contracts concluded by insurers. „It means that the responsible motor vehicle owners have collectively to pay for road traffic accidents caused by motor vehicles that have participated in road traffic without having valid MTPL insurance policies.”

The statistical data summarized by the MIBL show that currently about 2-3% of motor vehicles participating in the traffic on Latvian roads are without valid MTPL insurance policies.

Information source: MIBL

Private person insurance