Car Accident With A Romanian-Insured Vehicle: Understanding Loss Of Use Coverage under Romanian Law

When a motor vehicle is damaged in an accident, the financial consequences often extend beyond the cost of physical repairs. One of the most significant, yet often overlooked, aspects of the total loss suffered by the victim is the inability to use the vehicle during the period it is being assesed. Known as loss of use, this type of damage can have substantial legal and financial implications, particularly in the context of insurance policies and cross-border claims.

In this article, we will examine the legal framework for loss of use compensation in Romania, clarify when and how these provisions apply, explain the types of evidence and documentation required to support a claim, and highlight how German standards—such as the Eurotax-Schwacke table—can asist your case, even when the accident or repairs occur abroad.

1.     Legal Basis for Loss of Use Compensation Claims in Romania.

Under Romanian law, claims for loss of use are considered part of broader insurance claims and are fully recoverable.

This is explicitly regulated by Law No. 132/2017 on Compulsory Motor Third-Party Liability (MTPL) Insurance, which covers damages caused to third parties by vehicle and tram accidents. Specifically, Article 11(2)(d) provides that: “the MTPL insurer shall compensate damages arising from the inability to use the damaged vehicle, including its temporary replacement, at the injured party’s discretion.”

Importantly, when the injured party chooses to recover their losses through their own insurer, the at-fault party’s insurance company is still bound by the method of determining the amount of compensation owed under the MTPL contract. This obligation is set out in Rule No. 20/2017 on Motor Vehicle Insurance, Article 19(6)(c). As a result, the victim’s insurer can pursue a right of recourse against the at-fault driver’s insurer for all sums paid, including those related to loss of use.

For instance, if Vehicle A (liable) and Vehicle B (injured) are involved in a collision, and B’s insurer covers both the repairs and the cost of a temporary replacement vehicle, all expenses that will incur, including those related to loss of use, must be reimbursed by A’s MTPL insurer. This principle applies even when the parties or insurers are based in different EU countries, such as Romania, Germany, or elsewhere.

A more detailed legal framework is provided by Article 25 of Rule No. 20/2017, which outlines both the conditions and documentation required to claim compensation for loss of use. According to this rule:

• Compensation is granted for the period during which the vehicle is technically unusable and under repair;

• The replacement vehicle must be of a similar or lower class and rented from an authorized company;

• The claim must be supported by evidence, such as invoices or rental agreements, that prove the loss and its duration.

2.      When Do Provisions Regarding Loss of Use Coverage Apply?

These legal provisions apply within the liability limits established by the MTPL insurance contract and only if the insured event occurred during the policy’s period of validity.

Therefore, even if the accident takes place abroad, such as in Germany, the Romanian legal framework still governs the claim for loss of use, as long as the at-fault party’s insurer is based in Romania.

3.     What Alternatives Are Available During Vehicle Repairs and Which Are Compensable?

When a vehicle is undergoing repairs following an accident, there are two main alternatives for maintaining mobility, both of which may be compensable under certain conditions:

• Vehicle Rental:  Provided that, according to Article 25 of Rule No. 20/2017, the rental vehicle is of a class similar to or lower than the damaged vehicle;

• Alternative Means of Transportation: This includes public transport, taxis, ride-sharing services, or other mobility options.

Romanian courts have consistently recognized the need to compensate injured parties for loss of use, especially when supported by clear and credible evidence. To strengthen your claim and minimize the risk of disputes or litigation, it is essential to maintain proper documentation, such as:

• Rental agreements and related invoices or receipts;

• Proof of payment for public transport, taxi, or ride-share services used during the repair period;

• Documentation showing when the vehicle was submitted for repair and the expected duration of the repair process.

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These documents are critical in demonstrating actual and provable loss of use.

As noted earlier, the method of calculating compensation—including loss of use—is binding on the MTPL insurer of the liable party. Therefore, the liable party’s insurer cannot refuse compensation simply because, for example, the victim did not choose the cheapest available rental vehicle. Once the loss and its valuation have been established by the injured party’s insurer (or supported by documentation), these are binding on the liable party’s insurer.

However, if the victim acts abusively—such as renting a luxury vehicle far exceeding the class of the damaged car for an extended period—the insurer may challenge the proportionality and necessity of those expenses. Compensation is not unlimited and must remain reasonable and foreseeable.

4.     The Cross-Border Relevance of the German Loss of Use Model: Practice in Romania.

In Germany, compensation for loss of use is frequently calculated using the Eurotax-Schwacke Loss of Use Table—a widely accepted reference that assigns daily compensation rates based on the vehicle’s class and market value. Notably, compensation may be granted even if no replacement vehicle is rented, as the table provides a standard monetary value for the lost utility of the damaged vehicle.

This approach, often applied by German courts, ensures a fair, consistent, and predictable method for assessing loss of use damages.

Based on Article 19 of Rule No. 20/2017 on Motor Vehicle Insurance, Romanian courts and the Policyholders’ Guarantee Fund (Fondul de Garantare al Asiguraților) have accepted the Schwacke system as a valid reference, particularly in cross-border cases involving accidents or repairs carried out in Germany.

As a result, when loss of use compensation is claimed from a Romanian insurer in such cases, the insurer and the court may rely on the findings of a German expert report, even if the calculation is based on the Schwacke table. These reports typically include a detailed breakdown of the damage assessment, covering both repair costs and quantified loss of use, and serve as a credible basis for judicial or administrative decisions.

5.     Loss of Use Claims: Procedure, Insurer Obligations, and Legal Consequences for Non-Payment.

The procedure for claiming damages following a motor vehicle accident—including compensation for loss of use—is governed by Rule No. 20/2017, commonly referred to as the “vehicle damage assessment” process. Additional provisions regarding timelines, insurer obligations, and penalties for non-payment are set out in Law No. 132/2017.

Key Procedural Steps:

a.     Technical Assesment of the Vehicle

Following an accident, the damaged vehicle must undergo a technical inspection to determine whether it is repairable or should be classified as a total loss. An expert evaluation is required in both scenarios.

b.     Documentation of Alternative Transport

While repairs are underway—or during the period in which the vehicle is assessed—the injured party typically relies on alternative transport (e.g. rental car, taxi, ride-share services, or public transit). Documentation of these costs is essential.

c.      Submission of the Damage Claim

After the vehicle has been repaired or declared irreparable, the injured party must submit the completed damage file to the MTPL insurer of the liable party.

d.     Insurer s Response and Payment Deadline

From the date of claim submission, the MTPL insurer has 30 calendar days to either:

·       issue a compensation offer based on the submitted documentation; or

·       reject the claim with a written and reasoned justification.

If the offer is accepted, payment must be made within 10 calendar days. Any delay triggers statutory penalties of 0.2% per day.

If the insurer fails to respond within 30 days, it becomes automatically liable to:

·       pay the full compensation amount requested; and

·       pay penalties of 0.2% per day, starting from the 31st day until full payment is made. 

6.     Conclusion: Securing Fair Recovery in Cross-Border Motor Claims.

Cross-border motor incidents involving Romanian insurers are subject to clear legal mechanisms that support recovery for both direct and indirect consequences of the accident. Romanian law offers a well-defined framework to address mobility-related disruptions, even when the event or subsequent repairs occur in another EU country.

Whether relying on formal documentation or established valuation systems recognized across jurisdictions, success in these cases depends on meeting procedural requirements and presenting credible evidence. With proper preparation, individuals affected by such incidents can secure equitable outcomes, regardless of geography. 

To conclude, if your vehicle is damaged due to someone else's negligence, you shouldn’t have to bear the burden alone. Whether you're unable to drive, forced to rent a rental car, or simply lose the use of a vehicle, you may be entitled to compensation under your insurance policy or the at-fault party’s coverage.

Filing a loss of use claim is a crucial step in holding insurance companies accountable. Don’t hesitate to pursue an insurance claim—especially when the damage affects your daily life or causes you to incur extra costs. Whether the harm relates to personal injury or purely to mobility, proper documentation and legal knowledge can help ensure you’re fairly compensated.