Motor Insurance: Luxembourg ask to stop compulsory execesses

Publication date: 23 July 2004

The Commission has served on Luxembourg a formal request to stop imposing a compulsory system of excesses in third party motor insurance.

In the Commission’s view, a system whereby the maximum amounts of excesses are laid down by law for all insurance policies covering third party liability in respect of vehicles habitually used in a Member State must be considered contrary to the freedom to market insurance products introduced by the third non-life insurance Directive. Such a system has the effect of restricting free competition between insurance undertakings and of limiting the choice of products available to prospective policyholders.

The formal request is in the form of a reasoned opinion. If Luxembourg does not give a satisfactory answer within two months of receiving the reasoned opinion, the Commission may decide to refer the matter to the Court of Justice.

More information:
Commission Press Release (IP/04/990)

ip_04_990_insurance.pdf (69 KB)