BUREAU CENTRAL FRANCAIS DES SOCIETES DASSURANCES CONTRE LES

BUREAU CENTRAL FRANCAIS DES SOCIETES D’ASSURANCES CONTRE LES ACCIDENTS D’AUTOMOBILES International Claims Handling and the Co. B AZERBAIDJIAN INTERNATIONAL INSURANCE FORUM 3 juillet 2015

Welcome Azerbaïdjan CA 14/06/13 Into the green card system 2

• Double goal of the system To facilitate the cross-border road traffic and CA 14/06/13 To maintain the degree of protection of road traffic victims 3

What’s new for an inhabitant of Azerbaïdjan with the green card system ? Ø He could now drive in all the countries of the green card system without paying any frontier insurance CA 14/06/13 Why ? Ø Because, this insurance for civil liability that he has subscribed to, is valid in all the countries of the green card 4

• How does it work ? Organisation Ø A national Bureau in each country guarantor of the payment and of the respect of the rules CA 14/06/13 Ø Correspondents appointed by the foreign insurers and approved by the Bureau They are in charge of the handling and the settlement of the claims Any insurer or an international claim handling office 5

Geographical scope Ø Limited to countries lying to the West of the Ural mountains and the Caspian sea and the countries bordering the Mediteranean sea (GA 2012) CA 14/06/13 Ø Future Membership possible for : • Algeria, Egypt, Lebanon, Libya and Syria • Armenia, Georgia and Kazakhstan 6

• Map CA 14/06/13 7

Co. B Council of Bureaux CA 14/06/13 8

Co. B as umbrella organization Association of National Insurers Bureaux CA 14/06/13 Under the aegis of the United Nations (UNECE United Nations Economic Commission for Europe). 9

Functioning of the Co. B Ø Committees • Management • Application • Monitoring • GRC • SRC CA 14/06/13 Ø Many ad-hoc committees (fraud, uninsurance…) Ø All countries are members of regional groups which sends delegates to these committees 10

We have a common rule : Internal Regulation art 4. 4 - a) Co. B constitution Ø Each member shall comply with • The constitution • Internal Regulations • And with all decisions made in accordance with the provision of this constitution CA 14/06/13 Explanatory Memorandum 11

• Article 7 : Issue and delivery of Green Cards Each Bureau = responsible for Ø printing Green Cards or Ø shall authorise its members to print them CA 14/06/13 solely for vehicles registered in own country any country where no Bureau exists provided that the member is established in that country. Not possible for transitional members Validity: at least 15 days 12

International claims handling and CA 14/06/13 Internal Regulations 13

• Article 2 : Definitions Accident : any event causing loss or injury which may, pursuant to the law of the country where the accident occurs, fall within the scope of compulsory third party liability insurance in respect of the use of the vehicle. CA 14/06/13 Injured party : any person (entity) entitled to claim compensation in respect of any loss or injury caused by a (foreign) vehicle in respect of the law of the country of accident. 14

• Article 8 : Confirmation of the validity of a green card Identified Green Card Ø Name of the Bureau or country code Ø Insurer’s name and/or code Ø Serial number of the GC CA 14/06/13 Demand for confirmation of the validity By fax or e-mail Definitive answer within 6 weeks No answer within 6 weeks ==> GC = deemed to be valid 15

• Article 9 : False, unauthorised or illegally altered Green Cards Any GC presented in a country for which it is valid, purporting to be issued under the authority of a bureau shall be guaranteed by that bureau, even if it is false, unauthorised or illegally altered. CA 14/06/13 However: not where a GC relates to a vehicle which is not legally registered in the Bureau’s country 16

• Article 3 : Handling of claims Investigate the circumstances of the accident in which a foreign car is involved – who issued the green card (= proactive attitude) // if there is a nominated correspondent > immediate transfer of the file CA If no correspondent – Bureau has to inform immediately the insurer or the bureau concerned – The Bureau is authorised to settle amicably or to accept service of any extra-judicial or judicial process. 14/06/13 Claims Handling of the Bureau in complete autonomy – in conformity with its legislation and jurisprudence BUT in the best interest // on express demand informing before taking final decisions 17

• Article 3 : Handling of claims Procedure to be followed if settlement is in excess of the conditions or limits applicable under the compulsory MTPL insurance → consultation CA 14/06/13 A bureau may not of its own volition or without the written consent of the insurer or Bureau concerned, entrust the claim to any agent who is financially interested 18

• Article 2 : Definitions The correspondent will handle the claim in the name of the Bureau and on the account of the foreign insurer CA 14/06/13 Bureau : sets out conditions under which it : Ø grants Ø refuses Ø Withdraws the approval 19

• Article 4 : Correspondents Bureau can - at any time - take over the handling and settlement Insurers and correspondents are free to arrange their mutual relations: Ø reimbursements Ø handling fees CA 14/06/13 BUT these agreements are not enforceable against the Bureaux 20

• Article 4 : Correspondents Article 4. 8 (new): guarantee of the handling Bureau towards the correspondent in case the correspondent is not reimbursed by the insurer. Guarantee = limited to : Ø sums advanced to injured party Ø Costs CA 14/06/13 BUT does NOT extend to : Ø handling fees Ø late payment interests CONDITIONS to invoke this guarantee : Ø between 6 and 9 months since demand for reimbursement sent by correspondent to insurer Ø prior payment of the injured party (correspondent must ADVANCE compensation) Ø copy of demand for reimbursement + at least 1 reminder 21

• Article 5 : Conditions of reimbursement Reimbursement of Ø sums paid as compensation to injured parties Ø External services (expert, lawyer, …) Ø Handling fee: • 15% of compensation paid CA • Minimum € 200 • Maximum € 3 500 14/06/13 Delay for reimbursement : currently 2 months (Article 5. 2) – Non respect: 12% late interest Supporting documents but without delay to reimbursement “pay first ; argue later” 22

• Article 6 : Obligation of guarantee Bureau = guarantor of its members (insurers) When? Non respect of the reimbursement delay – currently 2 months CA 14/06/13 Amount : principal amount of the reimbursement demand + 12% late interest sums advanced to injured party Guaranteeing Bureau pays within a period of 1 month How ? Via online Guarantee Call system 23

• Protection of visitors Goal = Extension of the Protection of Visitors system as established by the 4 th MID towards those countries of the GC System that do not belong to the European Economic Area. CA Method = Agreement between Bureaux, containing two different parts (basic and optional). Each Bureau can choose whether to adhere to one or to both parts, depending on the extent of protection it wants to offer. 14/06/13 Difference with the 4 th MID = No comparable sanctions mechanism ; no compensation body. 24

• Protection of visitors Basic Agreement : Ø Reciprocal exchange of information between Bureaux Ø Supply of information towards victims of road traffic accidents occurred in a different country than their country of residence CA Optional Agreement : Ø Insurers have the possibility (not the obligation) to nominate claims representatives in other countries. Ø In case no claims representative is nominated, the Bureau engages itself to take over this role, on condition of the insurer’s approval of the claims handling by the Bureau. 14/06/13 Common : Ø No sanctions and no compensation body ( « Gentlemen's Agreement » ) 25

Conclusion The principal preoccupation of the Co. B today is the financial stability of the system CA 14/06/13 Problems with financial stability of one country could first influence neighbouring countries and could finally spread over the overall system 26

• Financial Stability Member countries (2014): 46 Population: 940 000 *) Overall vehicle fleet: 350 000 *) CA 14/06/13 Green Card claims: 365 000 **) Green Card insurers: 1, 371 **) *) UNECE Statistics Database, latest available figures for 2010 **) Co. B Statistics 2013 27

It’s the reason why the Co. B demands at all the transitional members Ø A bank guarantee or cash deposit Ø A reinsurance treaty CA 14/06/13 Or could take sanctions like Ø Financial penalties Ø Temporary suspension Ø Termination of membership 28

Since 1951, the green card system works with the satisfaction of all its members for the best protection of cross-border road traffic victims CA 14/06/13 29

Thank you for your attention Merci de votre attention! www. bcf. asso. fr 30