Regulatory Alerts2021-04-22
Official Position on the Application of Article 22, Paragraph 1 of the Mandatory Traffic Insurance Act
The Croatian Financial Services Supervisory Agency (Hanfa) issued this official position to clarify that an insurance company is not obligated to directly compensate a leasing company for vehicle damage when the leased vehicle's recipient, who acts as the sole third party under Article 22(1) of the Mandatory Traffic Insurance Act, is not liable for the accident. Hanfa determines that the lessor cannot be considered a third party regarding property damage, regardless of whether it acts as policyholder or insured, while exclusively the leasing recipient qualifies as the third party entitled to claim compensation. Consequently, insurance companies may fulfill their statutory obligations by compensating only the non-liable leasing recipient, with any additional rights or duties between the lessor and lessee to be governed by their lease agreement.