Car Insurance question

dacouch

thenudeone wrote: »

If you "forget" to tell your insurer you've sold your car, then someone else drives it and has an accident but isn't insured, then YOUR insurer will be forced to pay up under this law:
http://www.legislation.gov.uk/ukpga/1988/52/section/151
esp. subsection 2) b)

Effectively what it means is that if a judgement is obtained in court against any person who was driving the car, even if it was stolen or TWOC'd at the time, the insurer of the car must pay up EVEN IF the driver wasn't the policyholder or named on the policy, and EVEN IF they don't have a driving licence. The only exception is that a passenger who knew or suspected the vehicle was stolen/TWOC'd can't claim.

Guess who YOUR insurance company would then come after to repay them, because the policyholder (YOU) had failed to comply with the policy conditions?

Hello Bankrupt City. Goodbye - savings, investments, car, house.

An example is here:
http://www.lv.com/upload/lv-rebrand-2009/pdfs/insurance/car/21121973_lv-motor-doi.pdf

2. Duty and revealing information
You must ...tell us as soon as possible about any changes,
for example, a change to the main driver, any claims/convictions/
endorsements, any modifications to the car, change to the use, drivers, car or address, which have happened since the insurance started or was last renewed. Failure to do so may invalidate this insurance.
6. Compulsory insurance laws
If under the law of any country we must make a payment which we wouldn’t otherwise have to make, you must repay that amount to us.

In reality the driver just needs to be identified for the Insurers to be liable

Scrounger

Thanks for clearing that up.

With legislation like that I can understand why motor policies are so expensive to buy.

Scrounger

thenudeone

Scrounger wrote: »

Thanks for clearing that up.

With legislation like that I can understand why motor policies are so expensive to buy.

Scrounger

If someone steals your car and then causes damage or injury, most people would agree that it wouldn't be fair for the innocent third party to lose out. Therefore you're left with the question of who's going to pay.

If this piece of law wasn't in place, then everyone who bought car insurance would have to pay (through the MIB uninsured driver's scheme). At least this way, the people who end up paying more are the people who had the opportunity to do domething to prevent the theft, i.e. the car owner. People who take a great deal of care with car security probably won't end up with a claim like this on their policies, so won't end up paying more for insurance because of a claim.

I agree it's not really fair either, but it's less unfair than everyone sharing the risk.

dacouch

thenudeone wrote: »

If someone steals your car and then causes damage or injury, most people would agree that it wouldn't be fair for the innocent third party to lose out. Therefore you're left with the question of who's going to pay.

If this piece of law wasn't in place, then everyone who bought car insurance would have to pay (through the MIB uninsured driver's scheme). At least this way, the people who end up paying more are the people who had the opportunity to do domething to prevent the theft, i.e. the car owner. People who take a great deal of care with car security probably won't end up with a claim like this on their policies, so won't end up paying more for insurance because of a claim.

I agree it's not really fair either, but it's less unfair than everyone sharing the risk.

Here's an example of RTA 151 in effect...

http://www.honestjohn.co.uk/forum/post/index.htm?t=99462

BertTheRaccoon

dacouch wrote: »

You're correct, if the new owner did not insure the car, then had a fault accident and was identified any third parties would claim against the original owner's (Who had not cancelled) insurance. They are obliged to pay thanks to the Road Traffic Act, the Insurers would then pursue the OP for the money they had paid out

Actually this is not correct.

I had exactly this situation with a claim a couple of years ago.

A lad bought a car from his mate, his mate didn't cancel his insurance. The new owner reversed his car into my client's passing vehicle.

I identified the insurer of the offending vehicle from a MID search, which revealed NIG as the insurer. I argued tirelessly that they had RTA insurer status as a) they insured the vehicle and b) we could identify the driver. NIG refused to pay so I issued proceedings.

Because the previous owner could prove change of ownership and this was also supported by the DVLA records, NIG evaded paying and I had to redirect the claim to the MIB (after a load more arguments about section 9 notice to MIB after proceedings had already been commenced against the uninsured motorist)