While owning a car in other countries might be a given, this is not the case in Finland. You might be surprised to discover that a good number of people who live in Finnish urban centres don’t own a car. This could be because most cities have reliable and effective public transportation so no need for a car. After all, if its not a necessity, owning a car only comes as extra expense including signing contract with car insurance companies and more.
However, you should not let this discourage you from getting your own car. Just keep in mind that car liability insurance (liikennevakuutus) is compulsory if you use a motor vehicle of any kind. It is commonly known as third-party insurance in other countries. It covers physical injury and property damage resulting from using a vehicle in traffic conditions.
Vehicle Insurance in Finland
Finland allows people to drive cars registered and insured in other EU countries for up to 90 days. After the 90 days, you are supposed to register the vehicle in Finland, and pay tax and insurance. Likewise, it’s mandatory to register a new car in your name within seven days of purchasing a car. You also have to get insurance within 7 days.
Alternatively, you can get a seasonal insurance known as seisontavakuutus if the vehicle is not going to be in use. Seisontavakuutus comes at a reduced rate, for the time the vehicle will be off the road. Insurance companies will charge different premiums based on elements such as the type, age and safety features. Safety features include things such as anti-locking brakes fitted on the vehicle.
Most Finnish insurance companies don’t apply claim bonuses. Even if a vehicle does not need to be registered, you are still obligated to take out motor liability insurance. So basically, any vehicle that is registered for use in traffic, must be covered by a valid motor liability insurance.
Decommissioned vehicles cannot be used at all in Finland. The same applies to cars without the mandatory liability insurance. If you decide to use the car anyway, the Finnish police are obligated to take off your license plate. Keep in mind that there is an annual vehicle inspection in Finland. So, if your vehicle is uninsured, it will not undergo the inspection since you cannot use it on the road anyway.
Voluntary Comprehensive Insurance in Finland
While liability or third-party insurance is compulsory in Finland, comprehensive policies are not. Therefore, a motorist is allowed to take out a voluntary comprehensive insurance policy to improve the extent of the insurance. Voluntary comprehensive insurance in Finland vary in scope from one company to another.
For instance, some cover the costs from damage to the car of the party causing the accident. It also covers the costs from damage caused on a parking lot or malicious damage. So, you should always confirm with your insurance company what the comprehensive cover entails.
When motor liability insurance does not apply in Finland
Like in other countries, there are situations where you might not need a liability insurance cover in Finland. For instance, where you own a car that doesn’t need to be registered and is not used on the road. It also applies to cars that have been withdrawn from use and are not used on the road.
Car owners also don’t need liability insurance if their car has been withdrawn from use for good. Therefore, as long as you are not using your car in traffic, you can stay without liability insurance. All cars in Finland come under the Act governing motor liability insurance. So you should keep this in mind when you’re considering whether you are obliged to insure your vehicle.
You should also keep it in mind when you use or move it in off-road areas such as gardens, fields, forests or on ice. It would be even more helpful to research widely on what motor vehicles mean under the act.
Other vehicles exempt from motor liability insurance in Finland
In Finland, there are certain vehicles of small weight or low speed that are exempt from motor liability insurance. For instance, motorized machines or tractors that do not need registration and whose top structural speed does not exceed 15 km/. Another type include combined harvesters and other motorized agricultural machines that do not need registration.
If you drive a trailer that does not need to be registered in Finland, you will not need liability insurance. In addition, you don’t need it for vehicles that are designed to be solely driven by kids and that do not need registration. Electric wheelchairs and lightweight unregistered vehicles intended exclusively for use by disabled persons also don’t need liability insurance. However, it only applies if they also don’t need to be registered.
Finally, you don’t need liability policies for light electric mobility devices whose power does not exceed 1 kW and structural speed does not exceed 25 km/h. In case you get into an accident with one of these vehicles, the Finnish Motor Insurers’ Centre will handle the case. However, it does not apply to electrical mobility equipment, which is outside the jurisdiction of the motor liability insurance system.
Motor vehicle insurance companies in Finland
The good news for you is that there are many motor vehicle insurance companies in Finland. They offer various services at different rates so it’s up to you to identify one that best suits your needs. You should be careful when shopping for an insurance policy since all the companies will advertise competitive rates.
Also note that while the scope of coverage might be the same, the prices will differ from one company to another. Each company uses a unique formula to calculate the risk and likelihood to file a claim. Keep in mind that while motor liability insurance is mandatory, car insurance is optional. All the insurance companies offer voluntary car insurance that gives users more financial resources.
The policy that you choose should depend on your car insurance needs. Remember that insurance needs will differ from one person to another. It is also based on other factors such as risk and the value of your car. Some popular insurance companies in Finland include If, LähiTapiola, Pohjola, Pohjantähti, Turva, Finnish P&C Insurance (POP Insurance) and Fennia.