Opinion: Vnuk Judgement is a Double Edged Sword for Classic Insurers

Insurance Edge Editor Alastair takes a look at the EU Vnuk judgement, and the proposals to force all classic vehicle owners to take out third party insurance, including those used off-road at shows and sporting events. It’s an opportunity for classic insurance specialists, but also a minefield for those who lack true affinity with enthusiasts and collectors.

What is the Vnuk case all about – and why does it matter?

Good question. It is a judgement by the EU Court of Justice that settled the argument about liability for a farm worker called Mr Damijan Vnuk, who was tipped off a ladder by a tractor and trailer reversing into a barn. You would think regular farm insurance might cover such a thing but you would be wrong. The EU have seized on the Vnuk ruling and issued a Directive which requires ALL vehicles (mechanically propelled) to have third party insurance, even when being used off-road.

Of course the UK may opt out of the new Directive after Brexit, but that seems unlikely, given the long history of Westminster simply rubber-stamping EU rules. The most plausible scenario is the UK will adopt the principle of mandatory third party insurance cover, with some headline-grabbing exclusions on the type of events where a vehicle can be displayed without cover, such as the NEC classic shows, static exhibits at various country fairs, charity events etc – the proviso could be that the engine must not be started.

Gentlemen, start your engines – and show us your cover notes!

There are a huge amount of classic events every summer. Trials, grass track, vintage hill climbs, sprinting, and then there are parades, which are a vital part of any outdoor classic show, a chance to see old cars and motorcycles chuffing along at a snail’s pace.

On the face of it, buying third party cover doesn’t seem too expensive a proposition. But some events like sprinting at Brighton involve old motorbikes hitting over 70mph, with spectators in fairly close proximity. Modern cars and bikes are also entered into this event, so the risk of third party injury is higher than say a classic parade around a field at Malpas Yesteryear Steam-Up in leafy Cheshire.

vnuk ruling classic vehicle insurance needed

So for brokers who really know the classic scene inside out, there will be an opportunity to offer cover to experienced classic vehicle owners, and competitors in certain events, with relatively little risk involved. Bigger events tend to be better organised as regards the marshalling of the crowd, so smaller shows, sprints and hill climbs are going to have to charge higher entry fees to cover the extra costs of compliance – there’s no way around that financial fact of life.

The fly in the ointment for all motorsport events lies in setting up a comprehensive database for vehicles which are NOT road registered, and in some cases, there may not be a V5C document. There are also some classic cars, tractors or lorries owned by two or three friends, or family members – all of whom have clubbed together to buy something that can be trailered to events a few times a year and enjoyed. How do you decide who owns that vehicle, and if things go wrong, who is liable – all of them, or one `named’ driver?

No such thing as a typical off-road accident

Now road hazards are many and varied, but until you have competed in motorsport, or even ridden a CCM enduro down a green lane at 25mph for fun, you have no idea of the many extra risks involved.

I’ve hit a fellow rider on the track at Croft, just after he was bumped off by another rider, right in front of me. Thankfully he was OK. I’ve seen a hill climb competitor catapulted over the straw bales and into the – thankfully sparse – crowd at Barbon Hill in Cumbria. Also seen a badly supervised child touch a hot exhaust at a show, receiving a nasty looking burn scar.

Once attended a BMF Show where a biker returning from a ride-out ran into a pedestrian wandering between stalls at the Peterborough Showground. Biker down on the ground, damaged bike and injured leg. But how can you effectively marshal every single person within a 20K crowd?

show risks spectator third party cover

Those who value in-depth knowledge will make it work

When the EU Directive comes into force the nature of club level motorsport is bound to change fundamentally. Some events will fold, some clubs too. Many classic owners will decide that the rigmarole of registering a vehicle, explaining in detail what it is, speed, power, times used per year, or insuring a small collection of mopeds and lightweight bikes just to trailer them to shows, is simply not worth the expense and paperwork.

Many classic owners are over 65 years old, and devout internet refuseniks, who don’t want others to know exactly what they have stashed in their garage or shed. That’s why the specialists who succeed in this niche insurance sector will be enthusiasts, employing truly expert staff, who understand the machinery, the people and the passion that fuels it. This isn’t a sector where AI can do the underwriting; it is too complex and esoteric. It requires the human touch.

Will the new EU ruling turn motorsport and classic ownership from a grass roots activity into a rich man’s hobby? Why not post a comment below?



About alastair walker 10512 Articles
20 years experience as a journalist and magazine editor. I'm your contact for press releases, events, news and commercial opportunities at Insurance-Edge.Net

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