It would cover all accidents “caused during the normal use of a vehicle for the purpose of transportation, including its use on private properties”.
Get Britain Out has criticised the plan, suggesting it was an unnecessary extra layer of bureaucracy which would swell the coffers of insurance companies at the expense of British taxpayers.
It also pointed out that if adopted, the new rules would appear to be in conflict with the UK Law (Road Traffic Act, 1998).
This stipulates that insurance is only required when vehicles are used on a road.
Jayne Adye, Director of cross-party grassroots campaign Get Britain Out, said: “This proposal is a fantastic example of overzealous EU law-making, which is out of touch with the real world.
“Rules concocted by remote bureaucrats in Brussels are having an adverse effect on the lives of many Britons, burdening them with extra costs and needless paperwork.
“Being forced to comply with these new rules could set British taxpayers back hundreds of pounds!
“This proposal will be music to the ears of insurance companies, who will find themselves with thousands of new customers.
“Clearly enforcing such a rule would require a sinister amount of monitoring from officials – dictating what private citizens chose to get up to on their private property.
“Mandating what people can get up to like this clearly demonstrates a worrying level of control still being exerted by Eurocrats.
“Extending the tentacles of the EU into another corner of our lives like this proposal, undermines the very notion of an Englishman’s home being his castle!
“After we Leave the European Union, our country will no longer be subjected to the whims of frenzied lawmakers who have shown themselves unable to produce coherent legislation.”
Valdis Dombrovskis, the European Commission’s Vice-President responsible for Financial Stability, Financial Services and Capital Markets Union said: “With today’s proposals, we are ensuring that victims of motor vehicle accidents will be better protected in future.
“In addition, when people move across borders and purchase a motor insurance policy in another EU Member State, their claims history will be treated in the same way as those of domestic consumers.
“This is good news for those who move across the EU and for all of us as EU citizens.”