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LAW OF THE REPUBLIC OF ARMENIA

of June 9, 2010 No. ZR-63

About compulsory liability insurance, following from use of vehicles

(as amended on 19-12-2019)

Accepted by National Assembly of the Republic of Armenia on May 18, 2010

Chapter 1. General provisions

Article 1. Coverage and main objectives of the Law

1. This Law governs the relations connected with compulsory liability insurance of owners of vehicles, and also other persons owning them on legal causes for the harm done to the injured persons owing to use of vehicles; establishes types of vehicles, the responsibility following from use of which is subject to compulsory insurance, and the group of people which shall insure the responsibility following from use of these vehicles; establishes the relations connected with creation, regulation of the activities of Bureau of the insurance companies performing compulsory liability insurance, following from use of vehicles and with implementation in its relation of control and also procedure for creation and use of the Guarantee fund and the Information system and other related relations.

2. Main objectives of this Law:

1) guaranteeing protection of interests of persons which were injured owing to use of vehicles;

2) implementation in the territory of the Republic of Armenia the system of compulsory liability insurance following from use of vehicles and providing continuity of its action, regulation of the relations connected with the insurance agreements signed on it;

3) establishment of powers of the organizations performing activities in the field of compulsory liability insurance, following from use of vehicles, and the bodies exercising control;

4) guaranteeing efficiency of payment procedures of insurance indemnities.

3. According to this Law the responsibility following from use in the territory of the Republic of Armenia of the vehicles registered in the Republic of Armenia in the procedure established by the Law, and also imported on the territory of the Republic of Armenia according to the procedure of driving and (or) managed on highways public of the Republic of Armenia, except as specified, established by this Law is subject to compulsory insurance.

4. According to this Law the harm done owing to the insured events taking place only in the territory of the Republic of Armenia is subject to compensation.

Article 2. The legal acts governing the relations connected with compulsory liability insurance, following from use of vehicles

1. The relations connected with compulsory liability insurance, following from use of vehicles, are regulated by the Civil code of the Republic of Armenia, this Law, the Law of the Republic of Armenia "About insurance and insurance activity", legal acts of the Central bank of the Republic of Armenia (further – the Central bank), rules and other legal acts of Bureau.

Article 3. The basic concepts used in this Law

1. The basic concepts used in this Law, and also in other legal acts adopted on its basis (if they do not establish other), make the following sense:

1) OSAO – compulsory liability insurance, following from use of vehicles;

2) the agreement OSAO – the agreement OSAO signed according to this Law between the insurance company having the right to implementation of OSAO and the insurer;

3) ceased to be valid according to the Law of the Republic of Armenia of 13.07.2013 No. ZR-93

4) the vehicle – the wheel vehicle (including passenger passenger automobiles, buses, minibuses, cargo vehicles, ranch wagons, special equipment vehicles, electric vehicles, motorcycles, tractors, trolleybuses) equipped for transportation across highways public of passengers and loads, and also for accomplishment of not transport works;

5) the victim (the injured person) – any person who owing to use of the vehicle incurred the personal or done to property harm provided by this Law which has the right to compensation according to the procedure, established by this Law and other legal acts. The persons which are also provided by the first offer of this Item having under the law the right to indemnification in case of the death of person are considered as the victims;

6) the owner (co-owner) of the vehicle – the physical person (the citizen of the Republic of Armenia, the foreign citizen, the stateless person) which is considered as the owner of the vehicle or the legal entity, the state (state body), municipality (local government body), diplomatic representations in the Republic of Armenia (embassies, consular establishments, representative offices of the international organizations);

7) the insurer – person who signed the contract OSAO with insurance company;

8) insured person – the owner of the vehicle, and also other person owning it on legal causes (including the driver) during validity of OSAO;

9) person which did harm or the causer of harm – person owing to whose actions (failure to act) harm is done;

10) the driver of the vehicle – person managing the vehicle which during insured event used the vehicle. The driver person training to driving is also considered;

11) insured event – the case or event provided by this Law in case of which insurance company or Bureau shall pay insurance indemnity to the victim or in the cases provided by the law and (or) the agreement OSAO, to other persons;

12) premium – the amount which is subject to payment of insurance company by the insurer for the entire period of implementation of OSAO in the amount of and on the conditions established by the agreement OSAO;

13) insurance sum – the maximum size of the insurance indemnity which is subject to payment by insurance company to the victim or in the cases provided by the law and (or) the agreement OSAO to other persons in case of insured event;

14) basic premium and the main premium – the settlement sizes calculated by Bureau according to appendix to this Law;

15) insurance indemnity – the amount which is subject to payment by insurance company to the victim or in the cases provided by the law and (or) the agreement OSAO to other persons in case of insured event. In sense of this Law in cases, the stipulated in Article 49 these Laws, insurance indemnity is also compensation of Bureau of the harm done to the injured persons at the expense of means of the Guarantee fund if other is not established by this Law or does not follow from sense of specific provision;

16) the non-refundable amount – the amount which is not subject within insurance sum to compensation by insurance companies or Bureau which is determined in the form of percent to certain amount and (or) insurance sum;

17) harm from use of the vehicle (harm) – the harm done by the vehicle using the engine of the vehicle or without it (including harm owing to explosion or ignition of the vehicle);

18) the approved declaration – the form of the established form completed in case of insured event on site of incident by participating persons of incident owning the vehicle legally of which their signature circumstances, the facts of incident and other data make sure;

19) bureau of the insurance companies performing compulsory liability insurance, following from use of vehicles (Bureau), – public organization which members according to this Law are the insurance companies having the right to implementation of OSAO, and also the Central bank - in the cases provided by this Law;

20) the Guarantee fund – the fund created according to this Law which managing the Bureau, and to account which in the cases established by this Law compensations are deposited is. In the Guarantee fund the assets established by part 1 of article 44 of this Law accumulate;

21) the Information system – the system conducting collection, storage, use, provision and statistics of the data established by legal acts relating to the OSAO system (including agreements OSAO, insurers, insured persons, insured vehicles);

22) Bonus-Malus – the system of discounts and allowances applied in the field of OSAO, as a basis which assumes insurance history and (or) driver's history;

23) the membership fee – the fees brought by insurance member companies of Bureau for membership in Bureau in the amount of and procedure which are established by rules of Bureau based on this Law;

24) trail car (semitrailer truck) – in the value established by the Law of the Republic of Armenia "About traffic safety control";

26) the maximum extent of the harm which is subject to compensation in case of independent settlement - the maximum extent of the harm done to property established by Bureau in case of which the participating parties of insured event without the consent of insurance company (insurance companies) can fill in the approved declaration;

27) the maximum extent of the harm which is subject to compensation in case of the approved declaration - the maximum extent of the harm done to property established by Bureau in case of which the participating parties of insured event with the consent of insurance company (insurance companies) can fill in the approved declaration;

28) the affiliate - in the value established by the Law of the Republic of Armenia "About insurance and insurance activity";

29) the registered vehicle – the vehicle which from authorized state body of the Republic of Armenia is registered addressed to (name) of any person or the organization and in the procedure established by the legislation is temporarily not removed from registration.

2. In sense of this Law of concept of insurance sum and insurance indemnity are used for each damage suffered established by this Law, – personal injury and the harm done to property if in this provision it is specially noted that the concept in general is used for OSAO.

Article 4. Right to implementation of OSAO

1. In the Republic of Armenia the insurance member companies of Bureau having the right to implementation of insurance on class, stipulated in Item 10 parts 2 of article 7 of the Law of the Republic of Armenia "About insurance and insurance activity" which have at least one permanent branch or the agent in each area of the Republic of Armenia have the right to implementation of OSAO and meet requirements, the established law and other legal acts.

2. Abuse of the insurance company having the right to implementation in the Republic of Armenia of OSAO of dominant position in the field of OSAO attracts the responsibility provided by the law.

Chapter 2. Agreement OSAO

Article 5. Agreement OSAO

1. The agreement OSAO on the conditions established by this Law insures responsibility of insured persons for indemnification, caused to the injured persons.

2. The agreement OSAO is signed between insurance company and the following persons:

1) the owner of the vehicle (except for the vehicles provided by part 2 of article 25 of this Law), and in case of the death of the owner before state registration of the right of the new owner – the owning heir or the party which is considered by the acquirer of the vehicle under the agreement of alienation (including subjects to the conclusion in the course of registration further the property rights concerning vehicles), or the lessee under the agreement of finance lease (leasing), or

2) persons importing the imported vehicles on the territory of the Republic of Armenia by driving (except for vehicles, stipulated in Item 1 part 2 of article 25 of this Law), irrespective of the fact of recognition by their owners of this vehicle.

3. Persons specified in part 2 of this Article have the right to authorize other persons to sign from their name the agreement OSAO based on the power of attorney issued in the procedure established by the law.

4. Each person shall have constantly signed and current agreement OSAO on everyone belonging to it on the property right (provided to it under the agreement of finance lease / leasing/) and the vehicle registered in the Republic of Armenia (except for the vehicles established by Items 1, of 2, 3 parts 2 of article 25 of this Law). Registration or re-registration of vehicles without presentation operating (including becoming effective at the time of registration and accounting of the property right concerning the registered vehicle) agreements OSAO, except for the vehicles established by Items 1, 2 and 3 parts 2 of article 25 of this Law is forbidden and also those vehicles which at the time of registration of the property right concerning them are registered, however immediately after registration are temporarily struck off the register. Competent state bodies are forbidden to resolve import to the territory of the Republic of Armenia by driving of the vehicles which do not have the coupon of OSAO, except for vehicles, stipulated in Item 1 part 2 of article 25 of this Law.

5. The insurance company having the right to the conclusion of the agreement OSAO shall sign the contract OSAO with each of the persons who addressed it identified by part 2 of this Article if the conclusion of the agreement does not lead to violation of the requirements established by the law and other legal acts for insurance company. At the same time in case of groundless evasion of insurance company from the conclusion of the agreement OSAO rules, the stipulated in Clause 461 Civil code of the Republic of Armenia are applied. The insurance company in case of the conclusion of the contract OSAO with the client is forbidden to force this client to the conclusion the last with insurance company of the transaction on other services or to consider the precedent condition of the conclusion of the agreement OSAO use of other services rendered by it. The insurance company in case of the conclusion of the contract OSAO with the client is forbidden to force this client to the conclusion the last with other persons of the transaction on other services or to consider the precedent condition of the conclusion of the agreement OSAO use of other services which are rendered by other person, except as specified, when this service is necessary for the conclusion of the agreement OSAO.

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