The Association of British Insurers (ABI) said that the government had written to it to confirm that it has decided to keep the UK within "the motor insurance ‘free circulation zone'", and that that position is expected to be ratified by the European Commission.
According to the ABI, the UK has secured agreement of the Council of Bureau, which administers the green card system, and the Department for Transport said it had also confirmed its ability to meet any cross-border claims involving UK drivers and haulage operators. While the decision remains subject to formal approval and confirmation of an introductory date by the European Commission, the ABI said it expected the Commission to make this confirmation.
Andorra, Serbia and Switzerland are three non-EU states which are currently part of the free circulation zone, which enables drivers to enter the EU using their domestic motor insurance policy. If the UK does remain a part of the zone, EU drivers will be able to enter the UK under the same terms.
The green card system is currently conducted on paper and documents cannot be delivered electronically. Each vehicle needs a separate certificate and the time required to apply makes last-minute journeys difficult.
The ABI said returning to the green card system would have created additional costs for motor insurance customers.
ABI director general Huw Evans said: “This is good news for drivers and haulage operators who no longer face the prospect of doing reams of paperwork and paying admin charges every time they get on a ferry to Europe. It’s always encouraging to see common sense prevail and I look forward to the Commission concluding the formalities as soon as possible."