Article 16. Principles of Paying Compensation

1. The responsible insurer or the Bureau shall pay compensation if the user of motor vehicle incurs civil liability for the damage caused to the injured third party. The compensation shall be paid taking into account the legal acts regulating compulsory insurance against civil liability in respect of the use of motor vehicles of the state in which the road accident took place.

2. The responsible insurer shall pay compensation to the injured third party if the user of motor vehicle incurs civil liability for the damage caused to the injured third party when using an insured motor vehicle, irrespective of whether the user acted in conformity with the terms and conditions of the insurance contract, except in the cases referred to in paragraphs 1 and 2 of Article 21 of this Law, and irrespective of whether the policyholder provided the insurer with all the information necessary for the conclusion of an insurance contract prior to its conclusion. The responsible insurer shall also pay compensation for the damage caused by the insured motor vehicle when the identity of the person who drove it is unknown, but the damage was done under the circumstances, which form the grounds for liability of the owner or any other user of this motor vehicle under Article 6.270 of the Civil Code.

3. The Bureau shall pay compensation in the cases referred to in Articles 17 and 18 of this Law.

4. In accordance with the procedure established in this Law, the insurer or the Bureau shall pay compensation if the claim for damages is presented within one year from the date when the damage was caused or within one year from the date on which the injured third party learned or had to learn of the damage but not later than within 4 years from the date of the road accident concerned.

5. Compensation for the damage caused by a towed motor vehicle (when under legal acts a driver of a towed motor vehicle is not necessary) shall be paid according to the insurance contract covering the towing motor vehicle provided that the towed motor vehicle was connected to the towing motor vehicle at the time of the road accident. If the towed motor vehicle (the driver of which is not necessary) got disconnected from the towing motor vehicle before the road accident, compensation for the damage caused by the motor vehicle which got disconnected shall be paid according the contract of insurance against civil liability in respect of the use of the motor vehicle which got disconnected where the user of the towed motor vehicle incurs civil liability in respect of the damage. Compensation for the damage caused by a towed motor vehicle (the driver of which is necessary) shall be paid either according to the contract of insurance of a towed motor vehicle or the contract of insurance of the towing motor vehicle, taking into consideration the user of which motor vehicle is held liable.