The Italian procedure in third party liability insurance – mechanism of action and risk for the insurance market
The Polish insurance market faces various problems, but one that is not talked about much is the so-called Italian procedure. The phenomenon concerns compulsory third party liability insurance for motor vehicles and poses a risk not only to insurers, but also to Polish drivers. At Bankier.pl, we present the problem of fraud in third party liability insurance.
About the so-called The Italian procedure in third party liability insurance has been known for several years. The Polish Insurance Association mentions it in its report on insurance crime, and insurers themselves are also aware of it. This phenomenon is becoming an increasing burden for the market because, on the one hand, it leads to an unauthorized reduction in premiums, and on the other hand, it poses a risk of identity theft for unaware citizens. In the Bankier.pl editorial office, we look at the mechanism of the Italian crime, indicating the path to follow if our data is used by criminals.
Where did the Italian practice in third party liability insurance come from?
As Patrycja Dudek from the Polish Insurance Association explains, The Italian practice consists in the “registration in the territory of Poland of vehicles actually used in the territory of Italy (mainly in the Campania region, with particular emphasis on the city and province of Naples) and concluding contracts for compulsory third party liability insurance ppm regarding these vehicleswithout taking into account the actual risk generated by the movement of these vehicles.” Monika Leżyńska, member of the management board of Allianz Polska, adds that the motive behind the phenomenon is the desire to obtain a lower rate for third party liability insurance, which is much lower in Poland, but also to avoid tax on vehicle ownership (so-called bollo auto), payment of fines or assets.
According to PIU, the average third-party liability insurance premium for 2024 in our country was PLN 538, while in Italy it is approximately EUR 600, and in Naples even over EUR 1,100. Criminals saw a chance to bypass the system, concluding vehicle purchase and sale contracts between the Italian owner and the Polish – often unaware or fictitious – buyer. In fact the car does not leave Italy: the buyer only receives the documentsadditionally, untruths are also confirmed by vehicle inspection stations that issue certificates for cars that have never been used in Poland, and finally the set of “papers” is returned to the first owner.
This is how Italians cheat Polish insurers
The Italian procedure is a problem for the insurance industry for all reasons lack of adequate risk assessment, which may result in overstatement of compensationand thus an increase in premiums, notes Monika Leżyńska from Allianz Polska. The problem is known and, according to information from the Polish Insurance Association, it is based on three mechanisms:
- Misrepresentation as to the place and manner of use of the vehicle in order to unduly reduce the third party liability insurance rate,
- Misrepresentation as to the circumstances of events resulting in obligations on the part of insurers in order to obtain undue compensation,
- Creating fictitious identities under which third party liability insurance contracts are concluded and not paying premiums or paying only part of them.
Criminals only benefit from concluding sham car sales contracts. First of all, they avoid paying third party liability insurance, Italian taxes and fines that go to the owner listed in the registers. Insurers also point out that there is a serious problem with settling claims under such contracts – they receive statements about accidents and witness accounts, but it is difficult to verify the perpetrator of the event.
Watch out for letters about unpaid third party liability insurance
– Especially A disturbing aspect of the “Italian procedure” is its connection with the theft of personal data. Unaware people become victims of crimes when their identities are used to insure even several dozen vehicles. – says Marek Dmytryk, director of the Retail Motor Insurance Office at Compensa. Risk of identity theft it is real and can affect anyone, that's why when we unexpectedly receive a letter from an insurance company or the Insurance Guarantee Fund regarding third party liability insurance fees, we should not ignore it. If the car was registered under our data without our consent and knowledge, we may receive both reminders to pay insurance premiums and a request to pay a penalty to the Insurance Guarantee Fund for the lack of mandatory protection. If we receive such letters despite regularly paying contributions, we should take several steps:
- Report the case to the prosecutor's office or the police, keeping confirmation of the report.
- Send information to the insurer that we are not the owner of the vehicle and our data has been illegally used (along with confirmation from the police/prosecutor's office) – in the event of receiving a reminder for payment of third party liability insurance.
- Send documents to the Insurance Guarantee Fund confirming the illegal use of our data – if UFG sends us a request to pay a penalty for lack of third party liability insurance, we can provide the necessary information via the UFG.pl portal.
- Report the use of our data, reserving your PESEL number and/or invalidating your ID card.
- Check information about your vehicles in the government service My Vehicle – in the event of any irregularities, please report them to the transport department responsible for your place of residence.
The Italian procedure is a problem for insurers and customers
The phenomenon of registering vehicles used in Italy in Poland is a problem not only for insurers, but also for Polish customers. The first ones they sell third party liability insurance based on data that has no basis in realitysuffering damage in the process, and additionally they often pay compensation in fictitious cases. Throughout the entire procedure Polish customers suffer as they may pay more for insurance and are additionally exposed to identity theft. PIU ensures that the industry counteracts the Italian practice, e.g. by analyzing databases and implementing appropriate procedures (e.g. sales), and the insurance companies themselves also have their own methods, e.g. by providing customers with remote contract service.
Monika Leżyńska from the management board of Allianz Polska estimates that a systemic solution to the Italian case is important for the future of the insurance market: :
As insurers, we do our best to counteract such practices, but we lack legal tools. As an industry, we cooperate with state authorities in combating it. Further cooperation between Polish and Italian government institutions, as well as the police from both countries, is needed to eliminate this practice. – says Monika Leżyńska, member of the management board of Allianz Polska.
It may also be an important step in the fight against the Italian practice sealing performance of technical tests by introducing the requirement to confirm them with photos or video, which Compensa draws attention to, also reminding about the need for joint action.
Without coordinated actions of the insurance industry and public institutions, the “Italian procedure” will continue to burden the Polish motor insurance system, increase premiums for all honest customers and expose citizens to the consequences of identity theft in order to fictitiously insure Italian vehicles on the Vistula River. – says Marek Dmytryk, director of the Retail Motor Insurance Office at Compensa.
Let us add that at the end of November 2025, an amendment to the Act on Compulsory Insurance, the Insurance Guarantee Fund and the Polish Motor Insurers' Bureau and the Act on Population Registration entered into force. Under these regulations, insurers can check whether the PESEL number of a client concluding a compulsory third-party liability insurance contract is confidential, which will ultimately be able to limit the conclusion of contracts using stolen data.
