There are several types of Montenegrin insurance coverage.
Third-party vehicle Insurance is a mandatory requirement in Montenegro and each rental car must be insured or the vehicle will not be considered legal. Therefore, a tenant cannot drive the vehicle until it is insured.
COMPULSORY THIRD PARTY (CTP) INSURANCE
Compulsory Third Party (CTP) Insurance in Montenegro is called Obavezno osiguranje od autoodgovornosti. CTP insurance is compulsory. Car rental agency cannot register a vehicle in Montenegro without it.
Compulsory Third Party (CTP) Insurance is insurance against liability for damage caused to third parties.
What is covered?
Compulsory third party (CTP) Insurance insures a tenant of rental car against liability for death or injuries he may inflict on other road users as a result of a motor vehicle accident for which a tenant of rental vehicle is at fault. Coverage extends to passengers of all vehicles involved in the accident, pedestrians and cyclists.
What is not covered?
CTP Insurance is a type of third party personal injury insurance. It does not, therefore, cover injuries sustained by a tenant of rental car and it does not cover any property damage a tenant may cause through the use of rental vehicle.
CTP insurance does not cover a tenant for injuries he might sustain in an accident that was his fault.
How is calculating CTP Insurance if the tenant is responsible for the accident?
Injured appeals to the car rental insurance company and the insurance company pays him auto repairs. A tenant pays the repair costs of the rental car at their own expense.
How is calculating CTP Insurance if the accident was not a fault of a tenant?
If a tenant is not responsible for the accident, the car rental agency appeals to the responsible driver insurance company and the insurance company pays for rental car repairs.
COMPREHENSIVE CAR INSURANCE (CNC)
Comprehensive Car Insurance (CNC) in Montenegro is called auto-kasko.
Comprehensive Car Insurance covers damage to rental vehicle, loss of rental vehicle or property, theft and damage to other property such as their vehicle.
If the rental car has a CNC Insurance the insurance company pays for rental car repairs in any case, even if a tenant is responsible for the accident, or he damaged the car without an accident.
CNC Insurance is a coverage in case of theft or total destruction of a car; coverage for the damage caused as a result of accidents on the roads (tipping, drifting), fires, hail, falling of flying object, falling of snow and icicles, avalanches, floods, vandalism, breakage or damage of headlights, tail lights, turn signals, mirrors, or scrap damage of car windows.
There are 2 types of CNC insurance in Montenegro: Full CNC and Partial CNC.
Generally, the rental contract specifies the amount of franchise (deposit).
The franchise (deposit) - is a part of the possible damage that may be caused to the rental car during the rent, and the volume of a tenant responsibility for damages cannot exceed the size of this part.
If the vehicle repair cost is less than the amount of the franchise (deposit), the vehicle repair cost is subtracted from the amount of the deposit, and the remaining balance of the deposit is returned by the car rental agency to tenant.
The franchise (deposit) can be specified in the rental agreement as fixed amount or a as percentage damage, it can be accepted in cash or can be frozen on a tenant credit card.
When the rental agreement ends and the vehicle has not been damaged, the deposit is returned to a tenant.
WHAT IS NOT COVERED
CTP Insurance and Partial CNC Insurance do not apply to cases of damage to wheels, windscreen, windows, glasses, tires, roof and underbody of the vehicle, as they do not cover the damage related to the driving of the vehicle on unpaved roads, under the influence of alcohol and drugs.
INTERNATIONAL MOTOR INSURANCE - GREEN CARD
To use the vehicle in international road communications there is another type of compulsory insurance called Green Card.
Green Card is an international agreement (policy) of compulsory third party insurance, as well as an arrangement between authorities and insurance organizations of multiple states to ensure that victims of road traffic accidents do not suffer from the fact that injuries or damage sustained by them were caused by a visiting motorist rather than a motorist resident in the same country.
If a tenant is planning a trip to another country, and the rental car does not have a green card, the tenant will not be able to drive this vehicle outside Montenegro.
WHICH INSURANCE IS BETTER?
Each tenant have to take this solution by himself.
Compulsory Third Party (CTP) Insurance covers damage only if a tenant is not responsible for the accident.
Comprehensive Car Insurance (CNC) covers the damage in any case, regardless of the guilt of the tenant.
But if Comprehensive Car Insurance (CNC) has a franchise the tenant shall be liable by the full amount of the deposit, in any case, regardless of his guilt.
The rental car price with CTP Insurance will be much less than the rental car price with CNC Insurance.