Car insurance cancellation charge £75!

Stooby2

londonTiger wrote: »

this has to be wrong, surely. It's the person whose insured not the vehicle. Why would third party just claim from whatever insurance policy was attached to the vehicle without cross referencing with the rider?

Well I'm thinking that as this was published in a national motorcycling magazine by a solicitor who specialises in motor legal claims, it's likely to be correct.

And I think you need to re-read it. If you pm me an email address I'll scan the article and send to you if you want. You could then email the solicitor and have a discussion with him about it.

facade

Quite simple.

The policy holder has insurance in force on the vehicle.
The insurance covers the policy holder, maybe his spouse, and a few others, to drive said vehicle.
The new owner crashes. He is driving with the policy holders permission (obviously, he sold him the car!), but in breach of the terms of the policy, so under the provisions of the RTA, the insurers have to pay third parties, but have right of recovery against the policy holder.

Now if the policy holder had "any driver" cover, things might be different, but the insurers would likely invoke the "owned and registered" clause to claim the policy holder was in breach, and recover their losses from him, as if there is one thing Insurance Companies don't like, it is paying out.

dacouch

facade wrote: »

Quite simple.

The policy holder has insurance in force on the vehicle.
The insurance covers the policy holder, maybe his spouse, and a few others, to drive said vehicle.
The new owner crashes. He is driving with the policy holders permission (obviously, he sold him the car!), but in breach of the terms of the policy, so under the provisions of the RTA, the insurers have to pay third parties, but have right of recovery against the policy holder.
.

Permission to drive has nothing to do with it, the RTA makes the issuer of a current un cancelled Certificate of Insurance liable for any claims by anyone (Whether they are covered by the policy or not) if they are identified.

If the Insurer pays out under their statutory obligation under this section of the RTA they can reclaim their outlay from their policyholder.

Johno100

Interesting debate, although well off topic.

Just a couple of points to throw into the mix.

Insurable Interest - once the vehicle is sold, the policyholder doesn't have an insurable interest in the vehicle and so isn't the insurance contract void?

Non-fault claim - all the debate thus far has been about the vehicle being sold, the purchaser failing to insure and having a fault accident where the seller could be liable if they failed to cancel their policy / remove the vehicle from cover. But what if the accident (or other type of claim) was non-fault, could the former owner and holder of the insurance receive a payout for a total loss of the vehicle?