Injured parties are not automatically entitled to a substitute vehicle

In the justification of the resolution of 17 November 2011, the Supreme Court stated that each case of reimbursing costs of renting a substitute vehicle had to be examined on an individual basis and the insurer was only obliged to reimburse adequate and economically justified costs.

In the opinion PIU, the resolution of the Supreme Court confirms the market practice applied to date by insurers:

• The fact that a driver cannot use his or her own car as a result of a loss does not result in the insurer being automatically obliged to reimburse the costs of a substitute vehicle to him/her.

• If the owner did not use the car, used it occasionally or owns another car which can be used, rental of a substitute vehicle may be unjustified.

• Expenditure on renting a substitute vehicle have to be adequate and economically justified.

The Supreme Court also stressed that “it is not justified to excessively extend the insurer’s liability for damages and, as a consequence, guarantee liability as this might lead to a considerable increase in insurance premium amounts.” “The Polish Insurance Association has been emphasising for a long time that an escalation of claims against insurers must result in an increase in premiums. This, on the other hand, will lead to an increase in the number of drivers without a valid third party liability insurance policy,” said Jan Grzegorz Prądzyński, President of the Polish Insurance Association.

The Supreme Court also referred to the matter of injured parties using means of public transport. It stated that although the possibility of using public transport itself could not be a reason for refusing the reimbursement of costs of renting a vehicle, there were cases in which it would be more justified that the injured party use other means of transport. Means of public transport were not precluded. “The opinion of the Supreme Court clarifies the rules of reimbursing the costs of renting a substitute vehicle, without generating additional costs,” said Grzegorz Prądzyński.

The resolution of the Supreme Court was as follows:

“The insurer’s liability under an agreement on compulsory third party liability insurance of owners of motor vehicles for a damage or destruction of a motor vehicle not used to pursue business activities encompasses adequate and economically justified expenditures on renting a substitute vehicle; the liability does not depend on the inability of the injured party to use means of public transport.”