The Spanish Government approved the new version of the Motor Vehicle Insurance Act in July, which extends compulsory insurance to a wider variety of vehicles and improves compensation. This represents a significant advancement in the protection of victims of accidents caused by motor vehicles.
This completes the parliamentary process for the Act, which transposes Directive 2021/2118 on civil liability insurance for motor vehicle traffic, as well as the control of the obligation to insure this liability. To this end, the Act amends the Act on Civil Liability and Insurance for Motor Vehicle Traffic and the Act on the Regulation, Supervision, and Solvency of Insurance and Reinsurance Undertakings. This new law will come into force the day after its publication in the Official State Gazette.
The Act establishes a clearer and broader definition of the vehicles that must have compulsory civil liability insurance; it expands the concept of a “traffic event”; it improves the system for valuing compensation for personal injury; it provides greater security for accident victims in case of insolvency by insurance companies; and it improves the authorities’ control of the existence of insurance.
In this regard, the transposition of the directive extends the definition of motor vehicles, which entails the extension of compulsory insurance to agricultural or industrial vehicles, which were previously exempt, thus increasing the protection of victims. To avoid penalties for not having insurance, the owners of these vehicles will have a period of 6 months from the publication of the Act to take out this insurance.
As a result of the case law of the Court of Justice of the European Union, the concept of a “traffic event” is also substantially broadened, which will grant greater protection to victims of road accidents, as established by the directive being transposed.
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Compulsory Civil Liability Insurance is Created for the Owners of Scooters
The Act also introduces the concept of a light personal vehicle, which are electric motor vehicles that travel on the ground by means of one or more wheels, have a single seat, and can reach a maximum speed of between 6 and 25 km/h if their weight is less than 25 kg, or a maximum speed of between 6 and 14 km/h if their weight is more than 25 kg.
These vehicles, which include electric scooters and personal mobility vehicles, must have compulsory civil liability insurance. The aim here is to reconcile the promotion of sustainable urban transport with the protection of victims of accidents caused by these new vehicles.
In order to establish the characteristics and scope of this amendment, the Valuation System Monitoring Commission will have 6 months from the publication of the Act to issue a proposal for the regulatory development of compulsory insurance for these light personal vehicles. Likewise, the Government must set up a public register of light personal vehicles before 2nd January 2026.
Traffic Scale is Modified to Increase Compensation for Victims
The Act also introduces substantial improvements in compensation for victims. These changes have the consensus of all parties involved, who meet in the Valuation System Monitoring Commission, demonstrating the willingness of the Public Administration, victims’ associations, insurers, and experts in insurance and civil liability to improve the regulatory framework.
These modifications are intended to streamline the procedure for valuing compensation, avoiding, where possible, legal action by allowing recourse to any extrajudicial alternative for dispute resolution; facilitating police reports free of charge; and establishing shorter deadlines for medical assessment and the issuance of expert medical reports, among other measures.
With regard to the amounts of coverage, they will be updated in line with the Consumer Price Index. Some compensation scenarios are also increased and compensation is extended to improve coverage for those affected, such as people dedicated to household chores within the family unit.
New Functions for the Insurance Compensation Consortium to Assist Victims
Also with the aim of providing greater security for road accident victims, the scenarios for compensation covered by the Insurance Compensation Consortium are extended. In this way, the Consortium will cover accidents in the event of insolvency by insurance companies, even if they are foreign entities.
The Consortium will also be responsible for compensating victims of traffic accidents caused deliberately, as well as for new scenarios involving motor vehicles that are being driven without the compulsory insurance.
Supervisory Control Powers are Strengthened
Act 20/2015 on the regulation, supervision, and solvency of insurance undertakings is amended to introduce preventive recovery plans as a tool for anticipating and managing crises at insurance companies and to guarantee the suitability of the people who manage the insurance companies. In this way, the supervisory control powers are increased and improved.
Transparency Measures are Established in Relation to Insurance for Taxis
The Act establishes transparency measures to guarantee the stability of insurance for vehicles intended for the provision of the public interest service of passenger transport by taxi. This establishes information obligations for insurance companies, both when subscribing and when renewing insurance contracts.
Regulation of Compulsory Sports Insurance is Improved
The Act corrects deficiencies in sports insurance regulations, which will favour an offer of accident insurance for federated athletes, with wider insured sums than at present.
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