MTPL for yourself: how direct settlement works and why it’s convenient

The update to motor insurance rules in 2025 brought drivers long-awaited convenience: now, a motor insurance policy protects not only the budget but also the time of the injured party. How does this system work, and why is it no longer necessary to adapt to other companies’ standards after a road traffic accident?

Under the traditional MTPL scheme, the injured party had to apply for compensation from the at-fault driver’s insurance company. This created double the stress: in addition to the accident itself, the driver was forced to adapt to the regulations and procedures of an insurer they had not chosen.

Direct settlement has finally resolved a long-standing problem with motor insurance: when we buy a policy from a familiar company, but if we are the ones involved in an accident, we have to go to others for the service. Previously, not all insurers operated under this scheme, which limited car owners’ options. However, from 2025, direct settlement has been fully integrated into the MTIBU system, applies to all existing contracts and has effectively become the standard model for receiving insurance payouts. At the same time, car owners have a choice of settlement scheme: to contact the at-fault party’s insurer or (if the circumstances of the accident meet the restrictions outlined below) their own insurer.

Direct settlement: how the protection mechanism works

The essence of direct settlement lies in the name itself. Instead of a long chain of actions, the driver is offered a direct route: in the event of an accident, the car repairs are paid for by the company from which they purchased their MTPL policy. In other words, the injured party contacts their insurer (for example, Euroins), receives compensation, has the car repaired and calmly returns to their normal routine.

Once the injured party’s insurer has paid out the funds or arranged for repairs at a garage, it independently ‘reclaims’ these funds from the at-fault party’s insurer via the MTIBU’s special clearing system. For the average car owner, this process remains invisible. They do not need to get involved in legal disputes or monitor transactions between insurers.

An interesting point: since, in the event of a road traffic accident where the car owner is the injured party, it has become possible to resolve the matter through one’s own insurance company, the criteria for choosing a policy are also changing. Instead of looking for the cheapest option, drivers are consciously choosing familiar companies whose services they trust.

When the ‘green light’ comes on: conditions for direct settlement

To take advantage of this convenient service, several logical conditions must be met on the road:

• Only two vehicles and direct contact. Only two vehicles that have collided directly with each other are involved in the accident.
• All parties are unharmed. Direct settlement is possible only if the damage is limited to property (damage to or physical destruction of the vehicle). If there are injuries or fatalities as a result of the accident, the direct settlement mechanism does not apply, and compensation is paid in the standard manner.
• Valid MTPL policy. At the time of the accident, either both vehicles or at least the victim’s vehicle must be covered by a motor insurance policy. It is the existence of such a policy that entitles the victim to claim from their own insurance company under the direct settlement procedure.

Nevertheless, it is important to understand that direct settlement is purely a service tool. It in no way affects the determination of fault or the legal rights of other parties involved in the accident. Its purpose is to eliminate bureaucratic delays and make the process of receiving compensation or repairs predictable and convenient for the victim. Instead of spending time sorting out the rules in someone else’s office, the driver receives clear guidance in a place where they are valued as a customer.

Myths about direct settlement: why they are unfounded

Statistics from the Motor Transport Insurance Bureau of Ukraine (MTIBU) show that the direct settlement procedure is becoming increasingly popular. But even here, there are preconceptions. Some drivers are convinced that if they apply for compensation from ‘their own’ company, it will try to save money, underestimate the value of the claim, drag out the process, and so on. These are myths that have nothing to do with actual practice.

The claims assessment procedure is clearly regulated by law. It includes mandatory stages: document verification, establishing the facts and circumstances of the accident, recording the damage, and determining the amount of compensation. The key point is that the law establishes uniform rules: liability limits, approaches to damage assessment and methods for calculating payouts are exactly the same for both direct settlement and the general procedure.

Another myth has been debunked thanks to legislative changes — if the at-fault party does not have a motor third-party liability insurance policy, there will be no full compensation for the damage suffered: the maximum you can expect is a limited statutory payment after applying directly to the Motor Transport Insurance Bureau of Ukraine (MTIBU). It is precisely to better protect the interests of victims that the direct settlement mechanism has been significantly expanded. In 2026, even if the person responsible for the accident does not have a valid policy, you will still submit a claim to your own insurance company. It will pay you the funds and then receive compensation from the MTIBU itself.

During wartime, journeys require even greater attention and protection. A road traffic accident is an unfortunate event that should not derail your plans. With updated service approaches and reliable insurance, your journey will remain safe, and the resolution of any issues will be swift and seamless.

You can purchase a MTPL policy with 4 quick steps on the Euroins website: https://is.gd/L60wQd

We wish you safe roads and reliable travelling companions!