Motorists spared £50 annual insurance hike as government scraps EU law in Brexit win

The rollout of smart motorways has been suspended by the government until at least 2025 in response to safety concerns from MPs and motoring groups.

Motorists will be spared a £50 annual insurance hike after the UK Government scrapped EU regulations.

A bill to scrap the EU’s Vnuk motor insurance law was passed today through Parliament and, according to government, will prevent a £2bn hike for the UK’s insurance industry.

Under the EU law, motorsports, agricultural machinery and light electric vehicles as well as those vehicles used on private land need to be insured.

“Sacking this nonsensical EU rule will protect the pockets of hard-working British people as we continue to help ease cost of living pressures,” said transport secretary Grant Shapps.

“This is another Brexit win and I’m delighted this bill has rightfully passed through Parliament, saving billions of pounds of additional insurance costs and protecting our world-leading motorsports sector.”

The law sparked controversy as it covered motorsports collisions – including Formula One – and treated it as regular road accidents, costing the motorsport sector an additional £458m per year.

“Motorists will no longer be faced with the additional costs relating to future accidents on private land and accidents involving a range of extra vehicles – including lawnmowers and golf carts,” said Motor Insurers’ Bureau’s chief executive Dominic Clayden said.

According to London law firm Stewarts, scrapping the law could lead to serious injury victims being denied compensation.

The law was introduced in 2014 after a European Court of Justice ruling on the case of a Slovenian farmer injured by a tractor on private land.

Stewarts’ lawyers argued the ruling applied a “purposive interpretation,” as its objective was “the protection of the victims of accidents caused by vehicles, without any limitation in respect of the use of those vehicles.”

“There is a compelling argument for compulsory motor insurance to apply in the universal, non-discriminatory way in which the CJEU found it should in Vnuk,” they said last year.

“Otherwise, the innocent victim would be denied compensation simply because they had the misfortune of being injured on private land or because the vehicle being negligently operated by the driver at the time happened to be an agricultural vehicle, rather than a ‘motor vehicle’ in the traditional sense.”