Auto insurers warn Latvian vehicle owners not to buy OCTA from foreign dealers / Article

The laws of the European Union (EU) provide that each member state must be responsible for the vehicles registered in it, including ensuring the possibility of purchasing OCTA, accordingly, if an OCTA policy for a vehicle registered in Latvia is purchased from an insurer not registered in Latvia, it is not valid, stated the chairman of the LTAB board Jānis Abāshins.

In accordance with the OCTA Directive, each Member State shall take all necessary measures to ensure that civil liability for the use of vehicles normally located on its territory is insured. This means that in order to participate in road traffic in Latvia and other EU member states with a vehicle registered in Latvia, an OCTA insurance contract can only be concluded with insurers that have the right to provide OCTA insurance services in Latvia.

LTAB representative Agris Daukšte told the “Pēcpusdiena” program of Latvijas Radio that recently, compared to other years, the car insurers’ office receives more information about the fact that owners of cars registered in Latvia purchase insurance policies in neighboring countries.

“Purchasing policies from insurers of neighboring countries is nothing new. However, a year ago, the situation was such that these cases were one or two per year. But now the situation is such that it is one or two cases a week. Why? And apparently that is the main reason is that the control over the validity of OCTA on the roads is more intense, because there are more and more average speed measuring devices that record the entire flow of vehicles that pass this radar, and therefore those violations are recorded more regularly and more often,” said Daukšte.

Daukshte said that people choose to buy insurance policies in other countries mainly because of lower prices or to avoid negative insurance history.

On the other hand, the head of the LTAB, Abāšin, noted that,

by purchasing an OCTA policy for a vehicle from an insurer of another member state, the owner of a car registered in Latvia risks a penalty for driving without a valid OCTA, as well as if such a vehicle causes a road traffic accident, the loss will have to be covered from his own pocket.

Car insurers drew attention to the fact that regulatory acts provide for the procedure by which a vehicle registered in Latvia, intended for sale in another country, can be insured by an insurer registered in another member state.

If the owner of the vehicle has decided to sell the car to a foreigner who plans to register it in another member state, then he is obliged to re-register the ownership rights and remove the car from the records for export from Latvia, and obtain transit number plates. Only in this case, the new car owner can purchase an OCTA policy from the national insurer where he plans to register the purchased vehicle, Abāshin pointed out.

OCTA was introduced in Latvia in 1997 to ensure the protection of the interests of third parties injured in road traffic accidents.

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