Council of Bureaux (CoB)

Council of Bureaux (CoB)

The Council of Bureaux is the managing organisation of the international motor insurance card system (the “Green Card System”) under the aegis of the United Nations (Economic Commission for Europe – UNECE).


Insurance Europe (CEA)

Insurance Europe (CEA)

The Insurance Europe (formerly: CEA) is the European insurance and reinsurance federation. Through its 33 member bodies – the national insurance associations – the Insurance Europe represents all types of insurance and reinsurance undertakings, eg pan-European companies, monoliners, mutuals and SMEs. The Insurance Europe represents undertakings that account for around 95% of total European premium income. Insurance makes a major contribution to Europe’s economic growth and development. European insurers generate premium income of over € 1,050bn, employ one million people and invest more than € 6,800bn in the economy.

The Insurance Europe’s mission is:

  • To draw attention to issues of strategic interest to all European insurers and reinsurers in a sustainable manner.
  • To raise awareness of insurers’ and reinsurers’ roles in providing insurance protection and security to the community as well as in contributing to economic growth and development.
  • To promote – as the expert and representative voice of the insurance industry – a competitive and open market to the benefit of the European consumer as well as corporate clients.

In order to achieve this, the Insurance Europe:
  • represents all European insurers and reinsurers

    The Insurance Europe is the European insurance and reinsurance federation. Through its member bodies comprising of national insurance associations, the Insurance Europe represents all types of insurance and reinsurance undertakings, including pan-European companies, monoliners, mutuals or SMEs. The Insurance Europe represents undertakings that account for around 95% of total European premium income.

  • positions the European insurance industry within the European and global regulatory frameworks

    The Insurance Europe is the voice of the European insurance industry at European and international level. The Insurance Europe is a fair and reliable partner and a contact point for institutions, politicians and supervisors. The Insurance Europe provides services to the European and International institutions to the benefit of its members. In the regulatory process the Insurance Europe develops, promotes and defends industry positions that are supported by technical research and expertise. Through government lobby, public affairs, industry forums and issue management, it contributes to achieve a positive political, social, business and economic environment.

  • provides a platform to its members

    The Insurance Europe provides the infrastructure for an exchange information and experience between members. The Insurance Europe plays a supporting role in relation to its members and provides information and guidance on issues of interest to the European insurance sector. The Insurance Europe promotes trust and confidence in the European insurance industry.

Internal Regulations

Internal Regulations (new unified agreement (1st July 2003)

During the parallel operation of the Uniform Agreement and its further development, the Multilateral Guarantee Agreement the idea of unification of the two agreements was first raised in 1999. The differences in the texts and as a consequence of this the different interpretations underlined the necessity of the unification.

A Working Group was founded for this aim which – considering the results of consultations with the members – finally created the new unified agreement called “Internal Regulations”.

In the Internal Regulations the unification of different definitions have been achieved, the text has become simpler and more comprehensive, further the definitions used are compatible with those of the EU directives. The Internal Regulations is a basic document consisting of the general rules and the optional parts. Further changes can be realised without resigning of the agreement. The Internal Regulations – the new unified agreement – replacing the former agreements came into effect on July 1st 2003.

The provisions of the new agreement should be applied from the date mentioned above and it applies to the new claims and to claims already under handling as well.

Beside the mentioned changes and more detailed regulations the main new feature of the agreement to be stressed is that the regulations regarding the reimbursement between the bureaux of the claims settled have changed and have become significantly stricter. The deadlines prescribed for the bureaux, their members or correspondents have become shorter and are partly resulting in a loss of rights.

The signature of this new multilateral agreement means that the 18 countries (member countries of the European Economic Area being obliged by the directive of the Union anyway) and the rest of the member countries undertook the guarantee that their relations and the accounting will be based on the insurance cover deemed to exist, with the elimination of the usage of the Green Card. This means that – considering its contents – this practice is identical to that of the Multilateral Guarantee Agreement.

Multilateral Guarantee Agreement

Multilateral Guarantee Agreement (15th March 1991)

Due to the increase of the international motor vehicle traffic the idea to facilitate the operation of the system changed in spite of the satisfactory functioning of the Green Card system. The members of the Green Card system raised the idea of concluding supplementary agreements which are aimed at the elimination of producing and controlling the Green Card as a documentary evidence of the insurance cover.

In the beginning the member countries concluded bilateral supplementary agreements. These accepted either mutually or unilaterally the registration number and the country designation as an evidence of the insurance cover. This depending on which of the parties was willing to provide a guarantee for the vehicles registered in his own country when crossing the other country’s border.

In December 1973 these agreements were first substituted by a so-called Supplementary Agreement of several countries, then on 15th March 1991 it was replaced by the Multilateral Guarantee Agreement.

This agreement was extended to Green Card Bureaux of all those countries which previously signed bilateral agreements accepting the registration number as the evidence of the insurance cover.

The Green Card Agreement

The Green Card Agreement (Uniform Agreement between Bureaux)

The Green Card Agreement is based on two principles:

  • The Green Card Bureau of the country where the accident occurred (Handling Bureau) has an exclusive competence to settle the loss in conformity with the law of the country of accident.

  • The Handling Bureau is obliged to act in the best interest of the insurer of the foreign motor vehicle causing the loss (Paying Bureau).

These principles are duly reflected in the wording of the Green Card Agreement. It is providing details, definitions of the Green Card System, as well as the rules of its operation, handling of claims and the conditions of reimbursement.

The Green Card defined by the Green Card Agreement is a proof of the compulsory insurance cover required in the visited country. Showing the card, the user of the motor vehicle would evidence the motor insurance cover. The Green Cards are printed by each Member State with a wording and in a format approved by the Economic Commission for Europe of the United Nations. The title of the card is printed in the language of the issuing country as well as in English and French. In addition to the official language of the country the issuing National Bureau is indicated in another official language. In its capacity as a Handling Bureau, the Green Card Bureau of the visited country or the insurance company appointed by this bureau shall settle the claim on behalf and to the account of the insurance company who issued the Green Card as the proof of an existing and valid liability insurance contract.

The basic wording of the agreement has remained the same over the years, though some of the articles have been refined with the practical experience gained over the years.

Council of Bureaux

Council of Bureaux

With a permanent location in London (and co-operating with the Economic Commission for Europe of the United Nations), the Council of Bureaux (CoB) is the main governing and representative body of the Green Card System. (established in November 1951.)

Its functions:

  • Administering the agreements between the Green Card Bureaux,

  • Finding solutions to the practical problems raised by any of the members related to the agreements between the Green Card Bureaux

  • Acting as the court of arbitration in disputes between the Bureaux

  • Co-ordinating with the Inland Transport Committee of the Economic Commission for Europe of the United Nations and other international organisations (such as the Commission of the European Insurers (Comité européen des assurances i.e. CEA) and the European Commission)

The operating rules of the Council of Bureaux are laid down in the Constitution of the CoB.

The operative issues and preparatory work needed for decision-making are undertaken by the secretariat of CoB as well as the various committees elected from the representatives of the Member States for a limited period. The main decision-making body of the CoB is the General Assembly, which is meeting annually since 1994 (its meetings were less frequent before 1994).

Countries participating in the International Green Card System

Countries participating in the International Green Card System

In June 1952 the resolution of the Inland Transport Committee established the Green Card System with the participation of eight countries with effect from 1st January 1953. The eight countries were: Austria, Belgium, France, Netherlands, Great Britain, Sweden, Switzerland and the Federal Republic of Germany. Within a half-year, another four countries (Denmark, Norway, Finland, Ireland) joined this system. In the next few years, most European countries followed them. Hungary has been participating in the Green Card system since 1961.

As the years passed, the number of member countries of the Green Card system continuously increased.

In the recent years more and more Eastern European countries introduced the compulsory motor liability insurance and joined the system. To ensure the proper running of the Green Card System, the Council of Bureaux is stipulating stringent rules of admission. In the earlier years new members were provided with a transitional membership with limited rights for a period of two years. This has now been increased to four years. The activity of the transitional members is supported and controlled by a committee elected by the General Assembly of the Council of Bureaux.

Although it has been declared as a European system, nowadays some Non-European countries (such as Morocco, Tunisia, Israel and Iran) also became part of it, for economical, political and tourism-related reasons.

The history and aims of the Green Card system

The history and aims of the Green Card system

Compulsory motor liability insurance was established in Europe between the First and Second World Wars in order to ensure the necessary indemnity for the traffic victims.

As a result of the increasing number of motorists within the booming tourist industry considerations were already made prior to the Second World War on the perspective of the extension of the territorial coverage of insurance abroad.

Following the Second World War the recently established United Nations or rather its Economic Commission for Europe (UN EEC), situated in Geneva, started to deal with this issue. Their aim was twofold:

  • To establish a system that would ensure that none of the traffic victims in European countries should get into a worse position just because the accident was caused by a motor vehicle registered abroad.

  • To ensure that the entry of people to other countries by car should not be delayed because the prevailing insurance regulations within that country are different from those in their home country.

This problem could have been solved by the harmonisation of the liability insurance laws of the European countries, however, this could not be expected in the near future.

On 25th January 1949 the working group of the UN dealing with this subject, namely the Principal Working Party on Road Transport of the Inland Transport Committee of the Economic Commission for Europe of the United Nations drafted its Recommendation No. 5 suggesting the adoption of the Scandinavian model that was already running since 1926. Essentially, it has been recommended that central insurance organisations of countries with compulsory motor liability insurance should follow the Swedish pattern. This means introducing the Green Card as the certificate of liability insurance guarantee; and these organisations should conclude an agreement with each other enabling them to settle in lieu of the foreign insurance companies the losses caused by foreigners.

Indemnity Account

Indemnity Account

The contractual system of the compulsory motor liability insurance was introduced on 1st July 1991 . The respective law (Gov. Dec. No. 58/1991. IV. 13.) assigned the Association of the Hungarian Insurance Companies to handle an isolated account of funds for those losses, that – in spite of the obligation to conclude an insurance contract – were caused by an uninsured or under some circumstances, by an unknown user of a vehicle, and to indemnify the respective claimants. From 1st July 1991 until 31st December 1995, in accordance with the insurers having started writing compulsory motor liability insurance, this duty of the Association (MABISZ) was administered via the Hungaria Insurance Company. In line with a further decision of the member companies, the Motor Claims Office of the Association of Hungarian Insurance Companies (Hungarian abbreviation: ESZE, former MABISZ GKI) was set up, starting its activity on 1st January 1996. One of the main tasks of this organization would be the settlement of the above-mentioned losses.

Although the wording of the law has been repeatedly amended, and as a consequence, the addressee of the obligation to fulfill this task has been changed, our office is steadily conducting this activity. Currently we are acting as the trustee of the Indemnity Account stipulated by the Gov. Dec. No. 171/2000 (X. 13.).

When should the trustee of the Indemnity Account settle the loss of a claimant?

1. When the loss was caused by using the motor vehicle of a registered user, who – despite the legal obligation to conclude an insurance contract – was uninsured, regardless to whether or not the motor vehicle was driven by the user or by anybody else with his/her approval or knowledge, or even in an unlawful manner.

2. When the loss was caused by the motor vehicle of an unknown user, however, with due consideration to the limitations and exclusions specified in the respective law.

3. In addition, the trustee of the Indemnity Account is obliged to settle the loss of the non-liable party, in case it is disputed whether the Indemnity Account or an insurance company is legally obliged to indemnify the claimant.

4. Finally, the trustee of the Indemnity Account has to advance the amount of indemnity to the non-liable party, not being the insured of those insurance companies, who are disputing which one of them is obliged to settle the claim of the innocent claimant in lieu of their insured client.

The amount of indemnity to be paid by the Indemnity Account

In case the loss was caused by the use of a motor vehicle of an uninsured user who had been obliged to conclude an insurance contract, the claimant is entitled to the same amount of indemnity – up to the coverage limits set by the law – as if any of the liability insurers would have to settle the loss on the basis of a valid insurance contract.

When the losses are caused by unknown users, the trustee of the Indemnity Account is not obliged to indemnify the claimant in the cases detailed below:

1. when the claimant is in a position to claim indemnity from social security or property insurance or liability insurance (though motor hull insurance is not to be taken into account),

2. the obligation of the trustee of the Indemnity Account shall not be extended to indemnify for damage to the motor vehicle, furthermore losses caused to the road, or to structures attached thereto, to the electric and communication equipment, or to other utilities and their fixtures, as well as to public means of advertising(eg: giant posters, electronic billboard).

3. Needless to say, the trustee of the Indemnity Account shall not be obliged to settle the loss in those cases, which are listed in the Article 8. Sub-sections a) – k) of Annex 1. (The general conditions of the motor liability insurance) of the Government Decree No. 171/2000. (X. 13.).

Therefore, no indemnity shall be paid for

1. losses of any property items in the motor vehicle causing the loss, other than the personal belongings of the passengers of the said motor vehicle

2. damage to the motor vehicle causing the loss

3. material damage or loss of profit claimed by an insured person of the motor vehicle causing the loss from another insured person of the same vehicle

4. ……..

5. ……..

6. losses occurring while using the motor vehicle as mobile machinery

7. losses occurring in the course of loading or unloading of a stationary motor vehicle, etc.

The trustee of the Indemnity Account shall not settle losses suffered by foreign claimants, unless at the time of accident, Hungarian citizens could have expected an indemnity in similar cases in the country of the claimant. (reciprocity)

* The Indemnity Account corresponds to the institution of a Guarantee Fund in other countries