Will car insurance go up if I stop driving for a short time?

HillStreetBlues

Why would there be an active insurance?
Wouldn't  car would only be insured for third parties if one  of the named persons is driving?

ontheroad1970

HillStreetBlues said:

Why would there be an active insurance?
Wouldn't  car would only be insured for third parties if one  of the named persons is driving?

If you don't cancel  the insurance then there is active insurance on the car - it is still insured to the policy holder until it is cancelled or it expires.  If no one else has insured it and there is a RTC, then they go after the active policy holder.  

400ixl

ontheroad1970 said:

400ixl said:

tombooth said:

Hi All,

I have been driving for 3 years so do not yet have an official No-Claims Discount but my insurance price has come down considerably over the past few years. I am now in a situation where I do not need to drive in the short term but may (or may not) need to do so again in a few months time. As such I am thinking of selling my car for now and, therefore not purchasing any car insurance. 

If I do buy another car, in say 6 months time, would I expect to have to pay a huge premium again or would it be more likely to be close to where I am right now?

Thank you

How far through the existing policy are you? It may be more cost effective to let the policy complete the current year if it is nearing completion. The combination of the cancellation fee and the extra years no claims discount could make it worth while.

You can keep you no claim without an active policy for 2 years with most insurers, so having a few months between policies is not going to cause an issue.

What happens if the OP's car gets stolen from its new keeper who hasn't insured it, and it leaves people severely injured?  The fact that the insurance is still live on the vehicle, means that they will go after the OP's insurance and the OP's insurance could void that insurance and go after them for the full value of the claim.  Yes it wouldn't be a likely scenario, but I would never recommend anyone do this.  

That is a good point and also one to consider as it is a risk and one typically I would look to avoid. Maybe asking for the policy to be put on hold for the period where cover is not required rather than letting it run.

You could also consider if it is for a few months is it worth selling the car where you would likely be seeing a loss (selling tends to be at a lower value than buying) in getting back to the equivalent car. Putting it on SORN to not get the tax (if it can be stored off road) and dropping the insurance to fire & theft only.

DullGreyGuy

HillStreetBlues said:

Why would there be an active insurance?
Wouldn't  car would only be insured for third parties if one  of the named persons is driving?

Section 151 of the RTA  and in particular 151(2)(b)

If there is a policy on the vehicle then that insurer must act as the "RTA Insurer" if the policy would have covered the driver had it been an "any driver" policy "without exclusions to liability". Hence letting a mate to drive your car or drink driving etc the insurer still has to deal with the third party if a judgement is made against the driver (most insurers will do this prior to a judgement to avoid legal costs).

Then the next problem is clauses 7 and 8 which allow the insurer to recover their outlay from 1) the driver and 2) the policyholder if they were complicit (eg had let their mate borrow the car). 

If your car is stolen, the driver identified and a claim occurs then the insurer has to payout despite the thief driving but can attempt to recover from the thief. The policyholder isnt complicit so no attempt is made against them.

If you sell your car and dont bother to inform your insurers and the buyer then has an accident without having bought any other insurance then your insurers have to pay out but can recover their money from either the driver or the policyholder because they've allowed this person to drive their car whilst it was insured by their policy.

What would happen in a sold then stolen vehicle? It'd probably be argued you were complicit having failed to cancel the insurance but you may try to argue against it because it was stolen. 

HillStreetBlues

ontheroad1970 said:

If you don't cancel  the insurance then there is active insurance on the car - it is still insured to the policy holder until it is cancelled or it expires.  If no one else has insured it and there is a RTC, then they go after the active policy holder.  

But that would be saying then that the thief is insured to drive the car if they go after the policy holder (current insurance on car)

To me the car is either uninsured or insured, it can't be both.

DullGreyGuy

HillStreetBlues said:

ontheroad1970 said:

If you don't cancel  the insurance then there is active insurance on the car - it is still insured to the policy holder until it is cancelled or it expires.  If no one else has insured it and there is a RTC, then they go after the active policy holder.  

But that would be saying then that the thief is insured to drive the car if they go after the policy holder (current insurance on car)

To me the car is either uninsured or insured, it can't be both.

It is both... the vehicle is insured, the driver is uninsured. The RTA deals with this making the vehicle insurer liable but enabling them to recover their outlay.

HillStreetBlues

Thanks for explaining, and supplying the legal text.
I can see how it would catch people out, I've would've been one.

I learn something new every day

Sea_Shell

DullGreyGuy said:

HillStreetBlues said:

ontheroad1970 said:

If you don't cancel  the insurance then there is active insurance on the car - it is still insured to the policy holder until it is cancelled or it expires.  If no one else has insured it and there is a RTC, then they go after the active policy holder.  

But that would be saying then that the thief is insured to drive the car if they go after the policy holder (current insurance on car)

To me the car is either uninsured or insured, it can't be both.

It is both... the vehicle is insured, the driver is uninsured. The RTA deals with this making the vehicle insurer liable but enabling them to recover their outlay.

Is this a recent change?   Say, in the last 10 years?  Or has it always been that way?

I'm sure it never used to work like that 🤔, being potentially personally liable for costs on an uncancelled policy.

DullGreyGuy

Sea_Shell said:

DullGreyGuy said:

HillStreetBlues said:

ontheroad1970 said:

If you don't cancel  the insurance then there is active insurance on the car - it is still insured to the policy holder until it is cancelled or it expires.  If no one else has insured it and there is a RTC, then they go after the active policy holder.  

But that would be saying then that the thief is insured to drive the car if they go after the policy holder (current insurance on car)

To me the car is either uninsured or insured, it can't be both.

It is both... the vehicle is insured, the driver is uninsured. The RTA deals with this making the vehicle insurer liable but enabling them to recover their outlay.

Is this a recent change?   Say, in the last 10 years?  Or has it always been that way?

I'm sure it never used to work like that 🤔, being potentially personally liable for costs on an uncancelled policy.

https://www.legislation.gov.uk/ukpga/1988/52/section/151/1991-02-01

Since 1991 when the act was first made, the wording has been tweaked over time but the basics have remained the same.

I'd say it doesnt happen often, most cancel their insurance, most buyers buy insurance, most dont have accidents but remember having circa 5 cases in my claims days (one big debate with a PH who's son had taken the car). Right now there are two active posts on here about RTA insurer due to drink driving and 6 months or so again there were two cases in quick succession on here of people who sold the car etc... one was nearly £80k they were being chased for. 

The most common time its used is when a car is stolen and the thief arrested but in that case there is no right of recovery from the insured and those that go about joy riding in stolen cars dont tend to have the funds to pay for the damages they cause.

Sea_Shell

I wonder if the widespread charging of cancellation fees is driving instances where people have been caught out?

Plus the increase in uninsured drivers generally.

Rather than anything fundamentally changing in the legislation?

Even having worked in the industry, it's not something I'd ever come across, so must have been pretty rare.

Client's used to sell cars, and keep their policies running all the time.  Usually with an eye to buying another one shortly.