The Green Card is an internationally-recognised document that confirms a driver has insurance cover - albeit the minimum legally required - within the EU and 24 non-EU participating countries.
But the Conciliation Committee, a joint body comprising members from the European Parliament and European Council, believes the Green Card has proved inadequate in resolving problems experienced by accident victims trying to bring a claim in a foreign country against a driver and insurer both resident in that country.
'Experience shows that the problems faced by the victim are, for example, a foreign legal system, a foreign language, unfamiliar settlement procedures and often unreasonably long settlement delays,' it said.
The new directive will ensure that EU drivers can make direct claims against insurance companies based in foreign EU Member States.
It also obliges all EU insurance companies that insure drivers working abroad to appoint resident representatives in countries where they could be subject to a claim, including those using the Green Card system.
Under the new rules, insurance companies will have to make a reasonable offer of compensation, or provide a reasoned refusal, within three months of the accident or the presentation of a claim.
They face penalties for breaking these rules and compensation bodies will be set up in each member state to pay victims not offered a settlement within the time limits or according to the procedures established by the directive. (April 2000)