Liability and insurance regulations as well as settlement practice in the individual European states show considerable differences. Any harmonization is hardly to be expected. And it could be assumed even less in the past. Nevertheless, there was a need to facilitate international cross-border traffic and, at the same time, ensure the protection of road accident victims.
Two objectives were in the forefront:
- Cross-border road traffic within Europe was to be facilitated by dispensing with the obligation to procure the insurance coverage prescribed for the visited country by taking out an insurance policy to this effect at the border.
- No road accident victim was to be put at a disadvantage by the fact that the damage incurred to him or her was caused by a foreign motor vehicle.
At the suggestion of Switzerland, the Geneva-based Inland Transport Committee of the UN Economic Commission for Europe attended to the above-mentioned objective. Therefore, in May 1948, a Sub-Committee on Road Transport was established. Modelled on a system introduced in Scandinavia, this sub-committee developed a uniform insurance certificate (the International Insurance Green Card).
By virtue of this certificate, a motorist crossing the border is treated as if he or she were insured according to the conditions of the visited country to the extent prescribed.
On this basis, in 1949, UN Recommendation No. 5 of 25 January 1949, addressed to governments, was adopted. It contains the guidelines for the Green Card System.
Contents of UN Recommendation No. 5 and agreements resulting from it
In each participating country, motor insurers create a central organization, the so-called Bureau, which is recognized by the government of the respective country and responsible for carrying out the tasks of the Green Card System.
Each national Green Card Bureau fulfils a double function. It issues international insurance certificates (of green colour – hence the name “Green Card”) to its members (motor liability insurers), which make them available to their customers (motorists).
This implies the guarantee for reimbursement of the claims expenditure incurred in the case of a foreign claim (function of Paying Bureau).
At the same time, the Bureau is obliged to settle any claim caused by a foreign motor vehicle provided with a Green Card in its area of competence (function of Handling Bureau).
Settlement takes place according to the laws and regulations of the visited country, so that it is ensured that the road accident victim always receives compensation according to his or her accustomed national standard.
The rights and obligations of the Bureaux are stipulated in an international agreement, the Internal Regulations, which are based not only on the UN Recommendation, but also on the EU directives issued to this effect.
Volume and scope
The Green Card System is a system limited to Europe and the countries bordering the Mediterranean. Currently the system comprises 48 countries, including four non-European countries.
Council of Bureaux (CoB)
The CoB is the umbrella organization of the national Bureaux domiciled in Brussels and in charge of the administration and the functioning of the Green Card System. It is operating under the auspices of the UN (Sub-Committee on Road Transport of the Inland Transport Committee of the Economic Commission in Geneva).
The CoB comprises all Bureaux of those countries which participate in the Green Card System.