Law on Compulsory Traffic Insurance - Unofficial Consolidated Text (NN, No. 151/2005, 36/2009, 75/2009, 76/2013, 152/2014, 155/2023)

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Unofficial Consolidated Text
Law on Compulsory Traffic Insurance
(Official Gazette "Narodne novine" No. 151/2005, 36/2009, 75/2009, 76/2013, 152/2014, 155/2023)

CHAPTER I. GENERAL PROVISIONS
General Provision
Article 1.
This Law regulates compulsory traffic insurance.

Transfer of European Union Legal Acts
Article 1.a
(1) This Law transposes the following European Union acts into Croatian legislation:

1. Directive 2009/103/EC of the European Parliament and of the Council of 16 September 2009 on insurance against civil liability in respect of the use of motor vehicles and on the enforcement of the obligation to insure against such liability (OJ L 263, 7.10.2009),
2. Directive (EU) 2021/2118 of the European Parliament and of the Council of 24 November 2021 amending Directive 2009/103/EC on insurance against civil liability in respect of the use of motor vehicles and on the enforcement of the obligation to insure against such liability (OJ L 430, 2.12.2021).
   (2) This Law ensures the implementation of the following European Union acts:
3. Regulation (EC) No 785/2004 of the European Parliament and of the Council of 21 April 2004 on insurance requirements for air carriers and operators of aircraft (OJ L, 138, 30.4.2004),
4. Regulation (EC) No 1137/2008 of the European Parliament and of the Council of 22 October 2008 on adapting certain instruments subject to the procedure laid down in Article 251 of the Treaty, Council Decision 1999/468/EC as regards the regulatory procedure with scrutiny (OJ L 311, 21.11.2008),
5. Commission Regulation (EU) No 285/2010 of 6 April 2010 amending Regulation (EC) No 785/2004 of the European Parliament and of the Council on insurance requirements for air carriers and operators of aircraft (OJ L 87, 7.4.2010).
   (3) When this Law grants the supervisory authority the power to adopt regulations, such regulations shall be adopted by the Administrative Board of the supervisory authority.

Compulsory Traffic Insurance
Article 2.
(1) Compulsory traffic insurance comprises:

1. passenger insurance in public transport against the consequences of accidents,
2. insurance of the owner or user (hereinafter: owner) of a vehicle against liability for damages caused to third parties (hereinafter: motor third-party liability insurance),
3. insurance of air carriers or aircraft operators against liability for damages caused to third parties and passengers,
4. insurance of the owner or user (hereinafter: owner) of motor-driven boats (hereinafter: boats), or yachts, against liability for damages caused to third parties.
   (2) The provisions of this Law do not apply to means of transport of the Armed Forces of the Republic of Croatia.
   (3) The Republic of Croatia guarantees compensation for damages in the following cases:
5. for damages arising from the use of means of transport referred to in paragraph (2) of this Article,
6. for damages resulting from a terrorist act involving the use of vehicles.
   (4) The provisions of this Law applicable to vehicle owners apply mutatis mutandis to the owner or user of an automated vehicle (hereinafter: owner of an automated vehicle), unless otherwise provided by this Law.
   (5) The provisions of this Law do not apply to the use of vehicles in events and activities related to motorsport, including races, competitions, training, testing, and demonstrations on restricted and marked areas, if the organizer of such activity or any other party has concluded a liability insurance contract or guarantee covering damages to any third party, including spectators and other persons, but which does not necessarily cover damages to drivers participating in such activities and their vehicles.

Definitions
Article 3.
(1) The following terms have the meaning specified in this Law:

1. automated vehicle means a vehicle as regulated by the law governing road traffic safety, which meets the conditions of the definition of vehicle under this Law;
2. residence means residence as regulated by the law governing domicile, short-term stay as regulated by the law concerning citizens of European Economic Area member states and their family members, and temporary stay as regulated by Regulation 987/2009 of the European Parliament and of the Council of 16 September 2009 laying down the procedure for implementing Regulation (EC) No 883/2004 on the coordination of social security systems (Text relevant to EEA and Switzerland) (hereinafter: Regulation 987/2009);
3. boat means a watercraft intended for navigation at sea as regulated by the provisions of the law governing safety in inland waters and territorial sea of the Republic of Croatia, with a total power output exceeding 15 kW;
4. insurance company means:
   a) an insurance company with its registered office in the Republic of Croatia conducting compulsory traffic insurance business with the approval of the supervisory authority, b) an insurance company from another member state conducting compulsory traffic insurance business through a branch or freedom to provide services, and c) an insurance company from a third country conducting compulsory traffic insurance business through a branch with the approval of the supervisory authority;
5. member state means a member state of the European Union and a contracting party to the Agreement on the European Economic Area;
6. Croatian Insurance Office means the national insurance office in the Republic of Croatia, whose functions and obligations are regulated by the law governing the establishment and operation of insurance companies and this Law;
7. yacht means a watercraft for sport and recreation as regulated by the provisions of the law governing safety in inland waters and territorial sea of the Republic of Croatia;
8. interest means statutory default interest paid by a debtor when failing to fulfill a monetary obligation within the prescribed period;
9. Crete Agreement means an agreement regulating mutual relations between national insurance offices of member states of the Green Card Insurance System;
10. user of a means of transport means a natural or legal person who, by the will of the owner, actually exercises control over the means of transport;
11. home member state means the home member state as regulated by the law governing the establishment and operation of insurance companies;
12. Multilateral Agreement means an agreement concluded between national insurance offices of EEA (European Economic Area) member states and other associated countries, under which the official registration plate of the member state in which the vehicle is habitually stationed is considered proof of valid motor third-party liability insurance;
13. national insurance office means a professional organization established in accordance with Recommendation No. 5 adopted on 25 January 1949 by the Road Transport Sub-Committee of the Inland Transport Committee of the United Nations Economic Commission for Europe, which brings together insurance companies authorized in one country to conduct motor vehicle civil liability insurance business;
14. supervisory authority means the Croatian Financial Services Agency established by a special law;
15. unidentified vehicle means a vehicle from point 35 of this Article that could not be identified, nor its liable insurer;
16. uninsured vehicle means a vehicle from point 35 of this Article for which no motor third-party liability insurance contract has been concluded, or the insurance term has expired, and the contract was not extended within the grace period;
17. liable insurer means an insurance company with which the owner of the means of transport causing damage has concluded a liability insurance contract for damages caused to third parties;
18. unmanned aircraft system operator means the operator of an unmanned aircraft system as regulated by Commission Implementing Regulation (EU) 2019/947 of 24 May 2019 on rules and procedures for the operation of unmanned aircraft (Text relevant to EEA) (OJ L 152, 11.6.2019);
19. insured amount means the value up to which an asset interest is insured, particularly for property damage and personal injury;
20. insured means a person whose asset interest is insured;
21. injured person means any person entitled to compensation for damage or injury caused by means of transport in accordance with this Law;
22. trailer vehicle means any vehicle intended to be towed by a motor vehicle;
23. grace period means the 15-day period following the expiration of an insurance contract during which rights and obligations under the insurance contract are extended;
24. area of member states of the Green Card Insurance System means the area of contracting states to the Crete Agreement;
25. area where a vehicle is habitually stationed means the area of a member state of the Multilateral Agreement:
    a) bearing its registration plate, regardless of whether plates are permanent or temporary; b) where insurance plates or a sign similar to the registration plate carried by the vehicle are issued; c) where the vehicle owner has domicile when no registration plate, insurance plate, or similar sign is required for a specific type of vehicle; d) where the traffic accident occurred when the vehicle involved has no registration plate or carries a plate that does not match or no longer matches the vehicle;
26. domicile means domicile as regulated by the law governing domicile, permanent and temporary stay concerning citizens of EEA member states and their family members, and residence as regulated by Regulation 987/2009;
27. means of transport means a vehicle, aircraft, boat, or yacht;
28. traffic accident means an event where damage arises from the use of a means of transport;
29. safety operator means an external person to the automated vehicle who monitors it via telecommunications link and is obliged to approve or select an alternative driving maneuver;
30. safety driver means a person inside the automated vehicle responsible for its supervision during testing and capable of taking over dynamic control;
31. third country means a state that is not the Republic of Croatia or another member state;
32. policyholder means a person who has concluded an insurance contract with an insurance company;
33. use of a vehicle means any use of a vehicle consistent with its function as a means of transport at the time of the traffic accident, regardless of vehicle characteristics and terrain, and whether it is stationary or in motion;
34. driver means a person operating the means of transport;
35. vehicle means:
    a) any motor vehicle propelled exclusively by mechanical power on land, but not running on rails, with:
    • maximum design speed greater than 25 km/h or
    • maximum net mass greater than 25 kg and maximum design speed greater than 14 km/h;
      b) any trailer vehicle used with a vehicle from sub-point (a), whether coupled or not.
      Exception to sub-points a) and b): invalid wheelchairs exclusively intended for persons with physical disabilities are not considered vehicles under this Law.
36. Green Card insurance means an international certificate of motor third-party liability insurance issued by the national insurance office as proof of valid motor third-party liability insurance in the area of member states of the Green Card Insurance System, which may be printed on green or white paper or presented in digital format.

Obligation to Conclude and Renew Insurance
Article 4.
(1) The owner of a means of transport is obliged to conclude an insurance contract for compulsory traffic insurance referred to in Article 2(1) of this Law prior to using the means of transport, and to renew it as long as the means of transport is in traffic and the vehicle is in use. (2) If a means of transport is subject to registration and must have a traffic permit according to registration regulations, the competent registration authority may issue or extend the validity of the traffic permit only after the owner of the means of transport to be registered presents proof that they have concluded an insurance contract for the insurance required by this Law. (3) If a means of transport is registered to a user according to registration regulations or based on an obligation under another applicable regulation, the provisions of this Law applicable to vehicle owners apply mutatis mutandis to the user. (4) The obligation to conclude and renew compulsory insurance under Article 2(1)(2) does not apply to vehicles temporarily or permanently withdrawn from use and prohibited for use in accordance with special regulations, which are used exclusively on areas where access is restricted according to special regulations. (5) If an unmanned aircraft system operator is subject to registration, the competent registration authority may issue a registration certificate only after the operator presents proof of concluding a compulsory traffic insurance contract as required by this Law and applicable EU regulations. (6) The owner of an automated vehicle is obliged to conclude a compulsory traffic insurance contract under Article 2(1)(1) and (2) for the use of the automated vehicle, and such insurance also covers the liability of the safety operator of that vehicle and the safety driver during the testing phase.

Co-insured Persons
Article 5.
Insurance of the owner of a means of transport against liability for damages caused to third parties also covers damages caused by persons who, by the will of the owner, participate in the use of the means of transport.

Obligations of Drivers
Article 6.
(1) The driver is obliged to carry an insurance policy or other proof of a concluded compulsory traffic insurance contract during the use of the means of transport in traffic, which must be presented upon request by an authorized official. (2) The driver is obliged, in case of a traffic accident, to provide personal and insurance data required by this Law to all participants in the traffic accident who have the right to submit compensation claims based on these insurances. Both the driver and all participants are obliged to actively cooperate with the insurer in determining liability for damage and enabling the inspection of vehicle damage. (3) In the case of an automated vehicle, the authorized official verifies the existence of a compulsory traffic insurance contract by accessing the information system. (4) The owner of an automated vehicle is obliged, in case of a traffic accident, to provide personal and insurance data under this Law, as well as relevant driving data recorded by the automated vehicle, to all participants in the traffic accident who have the right to submit compensation claims based on these insurances, without delay and no later than three days from the date of the accident. The owner must also provide this data upon request by the liable insurer for claim settlement, and upon request by traffic supervisory authorities, judicial bodies, and other bodies conducting proceedings related to the traffic accident to exercise their rights and obligations under this Law. (5) The manufacturer of an automated vehicle is obliged to provide data and information necessary for claim settlement, upon request by the vehicle owner, insurer, injured person, traffic supervisory authority, judicial bodies, and other bodies conducting proceedings related to the traffic accident to exercise their rights and obligations under this Law.

Obligation to Submit Traffic Accident Data
Article 7.
Authorities authorized for traffic supervision, judicial bodies, and other bodies conducting proceedings related to traffic accidents, or possessing data related to traffic accidents (health institutions, institutes performing health, pension, or disability insurance, and other bodies), shall enable insurance companies and the Croatian Insurance Office access to traffic accident data necessary for claim settlement.

Insurance Contract and Its Effect
Article 8.
(1) An insurance company is obliged to conclude an insurance contract in accordance with this Law and the insurance terms.
(2) An insurance company may not reject an offer to conclude an insurance contract if the offeror accepts the terms under which the insurance company conducts that type of insurance.
(3) Insurance terms are an integral part of the insurance contract, and the insurance company is obliged to deliver them to the policyholder upon concluding the contract.
(4) Insurance terms establish relations between contracting parties that are not or are not fully established by this Law.
(5) The obligation of an insurance company under the insurance contract begins after 24 hours from the day indicated in the insurance certificate as the start of insurance, and ends after 24 hours from the day indicated in the certificate as the expiration date, unless otherwise agreed. (6) For insurance contracts concluded for one or more years, rights and obligations under the contract are extended after expiration for 15 days (grace period) if the policyholder has not delivered a declaration to the insurance company at least three days before expiration stating that they do not agree to extend the contract. (7) If an insured event occurs during the grace period referred to in paragraph (6), the policyholder is obliged to pay the insurance premium for the entire following year of insurance. (8) If during the grace period referred to in paragraph (6) the policyholder concludes an insurance contract with another insurance company, the previous insurer is entitled to a premium for the period up to the date of concluding the contract with the other company, proportional to the period of its insurance coverage. (9) If an insurance company determines that a vehicle owner's insurance coverage has expired, it is obliged to notify the competent internal affairs authority within 15 days from learning that coverage has expired. (10) If an insurance company determines that a means of transport owner's coverage has expired, it is obliged to notify the Information Center of the Croatian Insurance Office within 15 days from learning that coverage has expired. (11) An insurance company is obliged to conclude an insurance contract in accordance with premium tariffs.

Territorial Validity of Insurance
Article 9.
(1) An insurance contract for compulsory insurance under Article 2(1)(1) and (4) must cover damages arising within the territory of the Republic of Croatia.
(2) An insurance contract for compulsory insurance under Article 2(1)(2) must cover damages arising within the territory of the Republic of Croatia and the territory of member states of the Green Card Insurance System.
(3) Insurance coverage for compulsory insurance under Article 2(1)(2) applies to the territory of the Republic of Croatia and the area of member states of the Green Card Insurance System, unless otherwise agreed.

Reporting to Supervisory Authority on Insurance Terms and Premium Tariffs
Article 10.
(1) An insurance company is obliged to notify the supervisory authority of the insurance terms used for insurances under Article 2 no later than 60 days before their application, to verify compliance with regulations, insurance principles, and professional rules. The company must calculate premiums based on actuarial methods and principles to ensure permanent fulfillment of all obligations, including forming adequate technical reserves. The supervisory authority may request premium tariffs, technical bases, and other elements used for calculating premiums to verify alignment with Croatian regulations. (2) Expiration of validity (3) Expiration of validity

Right of the Injured Person to Submit a Direct Claim
Article 11.
(1) The injured person may submit a compensation claim based on insurance under Article 2(1) directly to the liable insurer.
(2) If the injured person submits a direct claim, the liable insurer may not raise in response objections that it could raise against the insured person under law or contract for non-compliance with law or contract.
(3) Insurance companies may conclude an agreement under which a compensation claim based on motor third-party liability insurance can be settled by the insurance company with which the injured person has concluded a motor third-party liability contract.

Procedure and Deadlines for Settling Compensation Claims and the Right of the Injured Person to File a Lawsuit
Article 12.
(1) The liable insurer is obliged to promptly, and no later than 60 days from receiving the claim, determine the validity and amount of the claim and deliver a written decision to the injured person, namely:

• a reasoned offer for damage compensation, when liability is not disputed and the amount has been determined; or
• a reasoned response to all points in the claim, when liability is disputed or the amount has not been fully determined.
  (2) The reasoned offer and reasoned response referred to in paragraph (1) must contain at least the grounds for the decision and instructions on the right to appeal.
  (3) Upon receiving a claim, the liable insurer is obliged to promptly inform the injured person of their rights and obligations, as well as the insurer's obligations, and to actively and without delay take necessary actions to fulfill its duties under this Article. (4) If the liable insurer fails to deliver a reasoned offer or reasoned response within the period in paragraph (1), the injured person may file a lawsuit against it. A lawsuit filed before the expiration of the period in paragraph (1) is considered premature. (5) The liable insurer is obliged to pay the compensation amount from the reasoned offer or the undisputed amount from the reasoned response as an advance within 15 days from sending the offer/response, and no later than 60 days from receiving the claim. (6) In case of failure to pay compensation or the undisputed amount within the period in paragraph (5), the injured person is entitled to interest on the due compensation or undisputed amount, calculated from the date of submitting the claim. (7) In proceedings before the liable insurer, the injured person has the right to submit an expert opinion and a repair offer from an authorized service provider, personally chosen. (8) The supervisory authority adopts a regulation detailing the procedure for settling claims, the content of reasoned offers and responses, claim registration, and informing the injured person about insurer obligations and necessary data during claim settlement.

Measures of the Supervisory Authority
Article 13.
(1) The supervisory authority may impose one or more appropriate measures on an insurance company violating this Law, which may be:

1. warning,
2. order to remedy