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Member, Beacon International Group, Ltd.
BRUSSELS, Belgium--The European Commission has referred Italy to the European Court of Justice because of supposedly uncompetitive practices in motor insurance.
Italian legislation requires that all insurance companies licensed in the country to write third-party motor liability business must offer it in all regions of the country.
It also requires that prices for the cover are based upon technical results experienced in the preceding five years.In a statement, the E.C. said that the Italian regulation of tariffs is contrary to the principle of tariff freedom as laid down in the Third Non-life Insurance Directive (92/49/EEC) and given that the Italian tariff control rule applies to insurers having their head offices in other member states, the Commission takes the view that the regime is also contrary to the fundamental internal market principle of home state control.
Finland has also been referred to the Court of Justice over so-called transfer stickers and insurance.
In Finland, if a permanent resident imports a vehicle, they are obliged to acquire a transfer sticker and take out transfer insurance that covers third-party liability, regardless of whether the vehicle is insured in another member state.
The Commission says that this conflicts with the European Union motor directives and undermines the principle that the cover should be valid throughout the community, based on a single premium.