The Government ran a consultation on proposals to reintroduce exclusions for uninsured drivers from claiming Motor Insurers’ Bureau (MIB) compensation for property damage if in a collision with another uninsured or an untraced driver.
This is done under the Uninsured and Untraced Drivers Agreements between the Department for Transport (DfT) and the MIB which set the conditions for the MIB to investigate and pay compensation. The exclusion of property damage for such drivers was included in both agreements until 2017 but was removed because it was a breach of EU law. Now the EU law no longer applies, it would not be a breach to reintroduce the exclusion and return the agreements to the previous position.
The consultation to reintroduce the exclusion received overwhelming support. The common theme expressed by respondents was that uninsured driving is unacceptable and such drivers should not be compensated for property damage. We will now work to reintroduce the exclusions into the agreements with the MIB. This does not require a change to legislation. It only requires amendments to the Uninsured and Untraced Drivers’ Agreements between the Secretary of State and the MIB.
Removing this right for uninsured drivers demonstrates that the government is focused on tackling criminal behaviour and sensitive to regulations that impact negatively on the general public. The vast majority of law-abiding motorists pay for claims from uninsured drivers for property damage through their motor insurance premiums.
The financial benefits might be limited, with possibly a small net benefit. It will, however, send a message that uninsured drivers should not benefit from being compensated by the fund of last resort for property damage.
These actions will not affect the rights of uninsured drivers to claim compensation for personal injury as this was not included in this consultation.
The equivalent exclusion contained in the agreements between Northern Ireland and the MIB was never removed. So, reintroducing it would bring Great Britain into line, so that the exclusion is UK-wide.
The exclusion of property damage for uninsured drivers will now be reintroduced. This exclusion will require amendments to the Uninsured and Untraced Drivers’ Agreements between the Secretary of State and the MIB. The government will work with the MIB make changes to the agreements at the earliest possible opportunity.
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