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How Does Direct Settlement Work for MTPL in 2025?
On January 1, 2025, a new version of Ukraine's Law on Mandatory Motor Third-Party Liability Insurance (MTPL) came into force. In an earlier article, we covered all the key changes — now let's focus on one of the most important updates: mandatory direct settlement of claims by every insurance company.
What is direct settlement in MTPL?
Ukraine's direct settlement system for MTPL has been in place since 2016. Back then, 11 insurance companies signed an agreement allowing an accident victim to receive their payout from their own insurer, rather than from the at-fault driver's insurer.
Arsenal Insurance joined this agreement on December 12, 2016, and it remains in effect today.
The idea behind direct settlement is simple: after an accident, the injured driver turns not to an unfamiliar insurer, but to their own — a company they already have a relationship with and trust.
How did it work before?
Before 2025, direct settlement was only available if both parties in the accident held policies from insurers that were part of the agreement. If even one driver was insured with a company outside the agreement, direct settlement didn't apply.
How does direct settlement work in 2025?
Since January 1, 2025, every insurance company selling MTPL is required to offer direct settlement. This means any holder of an MTPL policy purchased in 2025 can file a claim directly with their own insurer after an accident.
Conditions for direct settlement:
- Only two vehicles are involved in the accident
- No one was injured — only property damage occurred
- The accident is documented — either by a police report or a Europrotocol
- Both drivers' MTPL policies were valid at the time of the accident
Important policy details
If the injured party purchased their MTPL policy in 2025, they can always file a claim with their own insurer, regardless of where the at-fault driver is insured.
- If their policy was purchased back in 2024, the injured party still gets paid by their own insurer — but compensation follows the old limits and factors in depreciation.
- If the at-fault driver's policy was issued in 2025, the payout follows the new limits, with no depreciation applied.
- If the MTPL policy was purchased in 2025, the injured party can file with their own insurer even if the at-fault driver has no insurance at all.
We've covered all the nuances of settlement across different combinations of old and new policies in this article.
Why direct settlement is a strong reason to choose your insurer carefully
Before mandatory direct settlement, many drivers didn't think much about which company they bought their MTPL policy from — after an accident, the injured party had to deal with the at-fault driver's insurer anyway.
That's changed now. Since 2025, you have the right to file your claim directly with your own insurer if you're the injured party in an accident. That makes choosing a reliable insurer directly tied to how fast and smoothly you get paid.
By buying an MTPL policy from Arsenal Insurance, you get:
- A guarantee of prompt payouts
- A simple, convenient settlement process
- The backing of a company trusted by hundreds of thousands of drivers across Ukraine
You can purchase a policy right now at this link.
