Global Motor Insurance and Vehicle Regulations Update: Trends, Risks, and Market Shifts for 2026

From Motor Vehicle Tax to Inspection: These Changes Await Drivers in 2026

3 Dec 2025

In 2026, drivers in Germany will face several new regulations affecting vehicle inspections, taxation, insurance, and technical requirements. The annual inspection sticker (“HU”) will return to a blue colour, and drivers with older licence formats will be required to exchange them by January 19. Motor vehicle tax will need to be paid in a single yearly payment rather than in instalments, and all newly registered cars must include a digital emergency call system. Fuel prices are likely to increase due to a higher CO₂ levy, and insurance premiums may rise for many vehicles — although some electric cars will continue to benefit from extended tax exemptions and new incentives.

Flood bills in Hat Yai drown vehicle owners

3 Dec 2025

Malaysians driving into southern Thailand are urged to ensure proper cross-border motor insurance after severe floods in Hat Yai left many vehicles stranded. Standard comprehensive policies do not cover foreign travel or flood damage, so extensions like Endorsement 101 and 57 are recommended, along with Thailand’s compulsory motor insurance. Motorists affected by the floods are advised to document damage, avoid starting vehicles, and contact insurers via hotline or app for towing and claims assistance. Insurers are coordinating with Thai authorities and local workshops to help recover vehicles, with claims tracked through the Digital Roadside Assistance app. Over 500 Malaysian vehicles were reported stranded during the floods, highlighting the importance of cross-border coverage for natural disasters.

FCA Will Lift Pause on Motor Finance Complaints in May 2026

3 Dec 2025

The FCA will lift the pause on handling motor finance complaints on 31 May 2026, allowing firms time to implement a potential compensation scheme and prepare responses. The pause, in place since January 2024, was to ensure orderly handling while the FCA assessed commission disclosures between lenders and brokers. Final scheme rules are expected in early 2026, and complaints will be addressed under specific timeframes, with most consumers receiving responses within eight weeks after 31 May. Leasing complaints are excluded and must be resolved from 5 December 2025, while firms must retain relevant records until 11 April 2031. Consumers who believe they were overcharged or misinformed about commissions are encouraged to submit complaints now.

According to a Mapfre study, Colombia has low vehicle protection; only 1 in 10 vehicles has voluntary insurance.

2 Dec 2025

A recent Mapfre study shows that Colombia has very low levels of voluntary vehicle insurance, with only about 12% of registered vehicles carrying optional coverage. This leaves most drivers relying solely on the SOAT, which offers limited protection and does not cover theft, property damage, or extended liability. In 2024, the country recorded 8,271 road fatalities, highlighting the ongoing risk despite a slight year-over-year decrease. Experts warn that many drivers do not understand key insurance concepts—such as coverage, deductibles, and exclusions—leaving them financially vulnerable after an accident. Strengthening insurance education is seen as essential to improving financial protection and promoting safer, more responsible mobility.

New Report Looks at The EV Repair Challenge

2 Dec 2025

The rapid adoption of electric vehicles (EVs) is creating challenges for post-accident repairs, particularly due to high-voltage lithium-ion batteries, which can be costly and pose safety risks even when only slightly damaged. AX’s new report highlights gaps in training, diagnostics, and standardized repair protocols, leading to precautionary write-offs and higher insurance costs despite many batteries remaining functional for years. While most UK repairers are trained, only a small proportion hold advanced EV-specific qualifications, creating a mismatch with the growing EV fleet. AX calls for coordinated industry action, including standardized post-crash procedures, clearer repair thresholds from manufacturers, and expanded high-voltage training for technicians and emergency responders.

Australian insurers offer cheaper deals for non-binary customers: “You’ll get a better offer”

1 Dec 2025

A 22-year-old Australian driver discovered that choosing the “non-binary” option on his NRMA car insurance quote reduced his annual premium by about $800 compared to selecting “male.” Tests by the Daily Mail confirmed similar results, showing significantly lower premiums for non-binary applicants compared with men, and in some cases even cheaper than for women. Insurers explain that premiums reflect historical risk data, which traditionally show higher accident rates among young male drivers. NRMA recently added a non-binary option to make its process more inclusive and says pricing will continue to evolve as more data becomes available. Other major insurers still offer only male/female options but advise non-binary customers to select whichever option feels most appropriate.

The cost of car insurance will increase between 10 and 20% in 2026

1 Dec 2025

According to a recent fiscal reform in Mexico, insurers will no longer be allowed to deduct VAT (IVA) on repair or indemnity payments — a change that is expected to increase the cost of car insurance premiums by roughly 10–20% in 2026.  As a result, policyholders may face higher deductibles and reduced coverage for repairs or vehicle replacement in case of a claim.  Experts warn this could lead many drivers either to downgrade their coverage or to cancel their policies altogether — a significant shift in the insurance market

This is how accident compensation will change (and not a little) in 2026 with the new Motor Vehicle Compensation Scale

1 Dec 2025

Starting in 2026, Spain’s updated Baremo de Autos will significantly change how compensation for traffic-accident victims is calculated. The reform includes a general 3–5% increase in payouts, clearer rules for calculating loss of income, and standardized protocols to evaluate psychological harm such as PTSD. It also revises medical tables to better assess long-term injuries and introduces more precise criteria for neurological and mobility-related damage. Vulnerable road users—motorcyclists, cyclists, and e-scooter riders—will receive more tailored consideration for their common injury types. To reduce court disputes, insurers will face stricter penalties for unjustified delays, pushing them to settle claims more quickly and fairly.

Non-binary premiums ignite insurer debate on gender-based pricing

1 Dec 2025

In Australia, reports that non-binary drivers may receive lower comprehensive car insurance premiums than male or female motorists have sparked debate about gender-based pricing. A Sydney driver discovered his NRMA quote dropped from $2,236 as male to $1,955 when he selected “non-binary,” while a female quote was $2,061. NRMA said the non-binary option was added to recognize diverse customers, but gender remains a factor in premiums alongside vehicle type and claims history. Experts note that crash and claims data mostly rely on binary classifications, and more nuanced research is needed to understand how gender impacts risk. This case raises broader questions about fairness and actuarial practice in motor insurance pricing.

AXA completes Prima majority stake purchase

1 Dec 2025

AXA has acquired a 51% stake in Italian digital insurer Prima for €500 million, with options to purchase the remaining 49% by 2029 or 2030. Prima, founded in 2015, writes €1.2 billion in premiums and holds about 10% of Italy’s retail motor market, leveraging direct distribution and advanced digital technology. The deal will nearly double AXA’s Italian motor insurance business and strengthen its digital distribution, targeting tech-savvy, price-conscious customers. Integration will focus on bringing Prima’s underwriting in-house, consolidating systems, and preparing for a potential full takeover. The acquisition, pending regulatory approval, is expected to close by the end of 2025.

Turning Data Into a Competitive Edge in UK Insurance

28 Nov 2025

The UK insurance market faces rising claims costs, shrinking margins, and increasing regulatory pressure, exposing weaknesses in outdated systems and fragmented data. Many insurers struggle with disconnected information, slowing decision-making and complicating compliance with regulations like IFRS 17 and Consumer Duty. Companies that build governed, connected data ecosystems gain real-time insight, enabling proactive fraud detection, faster claims processing, and reliable reporting. Agentic AI is beginning to automate claims handling and customer interactions, but its effectiveness depends on accurate, well-managed data. Insurers that treat data as a strategic asset and invest in integration, automation, and governance will be best positioned to reduce losses, improve customer experiences, and navigate a rapidly evolving market.

Texas makes it harder for undocumented immigrants to buy and register cars

27 Nov 2025

Texas has introduced new DMV rules that make it much harder for undocumented immigrants to buy or register a vehicle. The updated policy—effective November 18—allows only IDs that prove legal residency, such as a U.S. passport, military ID, DHS-issued ID, or a driver’s license, which excludes many undocumented people and those with pending asylum or DACA uncertainty. Immigrant advocates and car dealers warn that the change threatens people’s ability to work, shop, and safely move around, and will also hurt small auto businesses through reduced sales and economic activity. State officials claim the rule is meant to ensure valid documentation, though critics argue it will ultimately make roads less safe by pushing many vehicles off the legal registration system.