Budget Committee Backs OCTA Changes: Claims to Be Handled Through One's Own Insurer

On Wednesday, 7 October, the Saeima's Budget and Finance Committee endorsed, for the final reading, amendments to the law on compulsory civil liability insurance of land vehicle owners (OCTA). The changes aim to strengthen the protection of people affected by road accidents and improve how the OCTA system works.

Direct settlement of damages

The amendments introduce a new procedure under which a person whose vehicle has been damaged will, in certain cases, be able to turn to their own insurer rather than the insurer of the vehicle that caused the damage. The new arrangement is planned to start on 1 January 2028 and will apply to insured events occurring after that date.

Wider compensation options

Options for receiving compensation for vehicle damage have also been expanded to cases where the vehicle that caused the accident has not been identified. Compensation will also be available if the damage leads to the vehicle's permit to participate in road traffic being annulled. These changes will apply to insured events from 1 January 2027.

The bureau and the Guarantee Fund

The amendments also change the work of the Latvian Motor Insurers' Bureau. On matters linked to the public administration tasks delegated to it, the bureau will be supervised by the Ministry of Finance. The bill clarifies the bureau's public administration tasks, sets requirements for board members and refines the procedure for handling complaints.

The operation of the Guarantee Fund has been improved as well: where necessary, additional funds may be provided to pay out insurance compensation, and the fund's governance and oversight arrangements have been clarified.

Next step

For the amendments to take effect, the Saeima must still approve them in the third, final reading. The bill is planned to be placed on the agenda of next week's Saeima sitting.