The complete reform of the act makes the existing regulations clearer and less equivocal.

In the new law, deficiencies in the old law were corrected and at the same time future changes were anticipated, for example, the increase in the automation of driving. The basic principles of the law remain unchanged. The basic principles are the scope, the obligation to insure, and the principles and reimbursement benefits of compensating damage.

However, the change in the law brings many practical changes. For example, the penalties for failing to insure will increase and victims' legal protection will improve. In addition, insurance companies are now able to take claims history more flexibly into account in their products.

Read more about the changes:

\n

When did the new law come into force?

\n

January 1st, 2017.

\n

The exception is the section on medical expenses, which came into force in August 2016.

"}'>
\n

The consequences of failing to insure one's vehicle become more severe as a result of the new law:

\n
    \n
  • uninsured vehicles are not allowed on the road
  • \n
  • the police is able to immediately remove an insured vehicle's registration plates
  • \n
  • those failing to insure their vehicle may be liable to pay a penalty fee in addition to the insurance premium, which may be many times larger than the original premium.
  • \n
\n

The size of the penalty fee is affected by the period of time the vehicle has been uninsured, whether the failure to insure has been deliberate and repeated as well as whether the vehicle has been driven in traffic. The penalty fee for failing to insure is raised in the new law.

\n

Why are the consequences of failing to insure becoming more severe?

\n

Damage caused to an innocent party by an uninsured vehicle is paid out from a common fund, which means that other policy holders ultimately have to pay for that damage. The better vehicles are insured, the less we have to pay for damage caused by others.

"}'>
\n

The new law, however, exempts from the insurance obligation lightweight unregistered vehicles intended exclusively for use by disabled persons.

\n

In addition, it is no longer necessary to take out motor liability insurance for vehicles that have been withdrawn from use. However, it is worth noting that in this case the insurance must be cancelled separately. If the motor liability insurance has been cancelled, it has to be taken out again before informing Trafi that the vehicle is back on the road.

\n

Do light electric mobility devices have to be insured?

\n

There are no changes for insuring light electric mobility devices, such as electric balance boards and scooters. Most of these still do not need to be insured. Their speed, power and vehicle class are the deciding factors in this. Read more about insuring light electric mobility devices.

"}'>
"}'>
\n

As before, the law obligates insurance companies to take a person's claims history into account in insurance premiums.

\n

What effect does the law have on cases where a vehicle has multiple users? Whose claims history is be taken into account when determining the premium?

\n

The price of motor liability insurance is not only determined by the claims history. It is instead calculated from several of risk factors known as tariff factors. The price is affected by factors relating to both the driver and the vehicle.

\n

The reform of the Act governing motor liability does not change the way these factors are assessed, but continues to be based on calculated actual risks.

\n

In principle, the risk factors related to the user, including their history, are assessed according to the main user of the vehicle (in practice the owner and/or holder of the vehicle). If the vehicle has several holders, it is possible in insurance companies' products to take the claims histories and other risk factors related to the users into account.

\n

Claims history data are specific to each individual policyholder, so they can no longer be transferred to another person. However, when the insurance premium is determined, the insurance company may also take into account the claims history of a vehicle owned or controlled by the client's spouse. This is possible in situations where, for example, both spouses have used the vehicle or the vehicle will also be used by the policyholder's spouse. Each company decides for themselves how they use the claims history data and whether they take into account the data of more than one person.

\n

Claims history data are specific to each individual policyholder. Does this mean that, should an accident occur with one vehicle, this will also have effect on the bonuses of the policyholder's other vehicles?

\n

Not necessarily. It depends of the insurance terms and conditions of the company concerned. Check with your own insurance company.

\n

Can a company insure its whole fleet with one insurance policy, or does each vehicle have to be insured separately?

\n

The new law enables companies with a registered Business ID to insure their whole fleet with one policy, without distinguishing separate vehicles. This is known as group motor liability insurance. However, insurance companies are not obliged to grant group policies. These can be agreed upon separately. In practice, this kind of solution is best suited to large freight forwarding companies or similar that have large fleets of vehicles.

"}'>
\n

When compared internationally, Finland has very comprehensive motor liability insurance cover. Not even all the green card countries have cover for the driver (i.e. where the driver causing the accident receives compensation for their personal injuries).

\n

The risk of accident when in traffic is bigger than in many other areas of life. Statutory motor liability insurance gives comprehensive insurance cover. It compensates the personal injuries of both the innocent party and the party causing the accident. The innocent party who has been injured is covered both for personal injury and material damage. Motor liability insurance gives comprehensive liability insurance coverage also to the party causing the accident.

\n

The fact that motor liability insurance is obligatory, that is to say statutory, is also due to international legislation, i.e. the Motor Insurance Directive.

\n

What are the benefits of voluntary comprehensive insurance?

\n

Motor liability insurance does not cover personal injury and material damage suffered by the owner or holder of the vehicle that caused the accident. This damage can be compensated through voluntary vehicle insurance, i.e. comprehensive insurance. In addition, with comprehensive insurance there is the possibility to have extra cover against vandalism, fire or theft.

"}'>
\n

Not necessarily. It depends of the insurance terms and conditions of the company concerned. Check with your own insurance company.

"}'>
\n

The previously separate decree has now been integrated into the new Act governing motor liability insurance. The act obligates companies granting motor liability insurance to be members of the Finnish Motor Insurers' Centre (LVK) as well laying down provisions for the administration and funding of the centre. In addition, the State Treasury will become a member of LVK.

\n

The new law states that LVK no longer determines the payment for failing to take motor liability insurance (compensation fee), but it is now done by the State Treasury based on a recommendation by LVK.

\n

What kind of claims LVK compensates in future?

\n

LVK continues to compensate traffic accidents caused by uninsured, unknown and foreign vehicles as well as reindeer damage caused by vehicles to the owners of the reindeer.

\n

As a result of the new law, LVK compensates damage caused by vehicles that have been freed from their insurance obligation. This task belonged to the State Treasury before.

\n

In addition, LVK continues to compensate damage in those situations in which a vehicle's motor liability insurance has been cancelled as a consequence of the vehicle having been stolen.

"}'>