According to the Act on Compulsory Insurance, motor insurance belongs to the property insurance section II. They are defined in the Act on Compulsory Insurance, Insurance Guarantee Fund and Polish Motor Insurers’ Bureau of May 22, 2003.
They include not only the obligatory third party liability insurance, but also voluntary accident insurance and accident insurance. In this article you will learn how motor insurance is divided, what the abbreviations mean and what you can get by buying a particular policy.
Motor insurance – definition
As we have already mentioned, motor insurance is included in the property insurance segment of section II. It is about the so-called other personal insurance and property insurance – r. They include:
liability insurance (so-called third party insurance),
motor hull insurance (the so-called AC insurance),
personal accident insurance,
These insurances are related to the risks incurred by the users of motor vehicles, i.e. they protect them against financial consequences of the events they have caused. Motor insurance is the most important element of the insurance market in Poland. The main factor contributing to this situation is the obligatory third party liability policy. A study by the Office of Competition and Consumer Protection (UOKiK), and more precisely from insurers’ data, showed that in Poland in 2018 there were 1,937,887 registered motor vehicles1. For each of them, the owner must purchase third party insurance.
Division of motor insurance
Motor insurance is divided into:
compulsory – which include liability insurance, popularly known as a third-party liability policy;
voluntary – which includes autocasco (AC), personal accident (NNW) and assistance insurance.
It is important to note that under Polish motor law third party liability insurance is not the only compulsory insurance. In the Act on Compulsory Insurance, the Insurance Guarantee Fund and the Polish Motor Insurers’ Bureau you will find many other compulsory insurances, but they are not classified as motor insurance. Let’s have a closer look at MTPL, AC, NNW and assistance insurances, which are the most popular among Polish drivers.
Third party liability insurance
Under Polish law, as the owner of a car you must purchase a third party insurance policy for it on the day of registration at the latest (except for historic vehicles). This is the only insurance which is compulsory for vehicle owners. You must purchase it if you own a motor vehicle, moped, agricultural tractor, trailer or slow-moving vehicle. You buy the policy for a period of 12 months and it will protect you from financial liability for damages that you may cause to other road users. The coverage extends not only to property, but also to the health and lives of the injured parties. In case of this policy, its scope is always the same. The guaranteed sums, i.e. the upper limit of the insurer’s liability, are:
1,050,000 euros – in case of damage to property,
EUR 5,210,000 – in case of personal damage.
The sums mentioned refer to one event – it does not matter how many victims there were in the event. Remember that if you do not have a third party insurance policy, you may be subject to heavy fines. You have to buy it even if you do not use your vehicle. The amount of fines depends on the minimum wage in a given year.
Motor Third Party Liability insurance is voluntary. It protects against the financial consequences of theft and damage to the vehicle, but in this case the owner receives compensation. In this case, the sums guaranteed are not imposed by law – the scope of protection depends on the signed contract. Under this policy, you can receive compensation, among other things, in case of damage caused by collision with another vehicle, fire, theft of the vehicle or its equipment. However, you should remember to check carefully the terms and conditions of your AC policy, as there are also versions with limited liability of the insurer, the so-called mini AC. Such a policy may cover only selected events.
The insurer may be exempt from liability if the incident occurred as a result of serious negligence on your part. Examples include leaving the car unlocked with the keys or driving under the influence of alcohol. Exclusions of liability can be found in the contract you enter into. Also keep in mind that the price of your policy may depend on the terms and conditions you choose. For example, the insurer may cover only 80 or 90 percent of the damage.