Motor insurance changes
Following a landmark European court case the UK government will very soon have to change the rules regarding motor insurance law to bring them in line with this judgement. The current Road Traffic Act (RTA) will have to be amended in Parliament.
The case, Damijan Vnuk vs Zavarovalnica Triglav, addressed what risks have to be covered by compulsory motor insurance, the ruling will affect most businessí insurance arrangements regardless of the sector they operate in.
This imminent change will affect many business insurance arrangements, as some incidents, currently covered under employersí liability (EL) and public liability (PL) insurance policies, will now be picked up by a motor policy.
It has been eight years since a tractor knocked over the ladder on which Damijan Vnuk was standing while loading hay into the upper floor of a barn in rural Slovenia. He sued the tractor driver for compensation for his injuries.
As a result of the ensuing litigation, any vehicles that businesses use in off-road settings will now require insurance cover that complies with the RTA. Many of these would previously not have been included in motor insurance policies.
This could mean that vehicles such as tractors, quad bikes, ride-on cleaning equipment, cherry pickers and forklift trucks will now be caught under the umbrella of a motor (fleet) policy.
Businesses have always been deemed liable for their employeesí negligent driving, whether on or off the road. However the insurance differences are very important.
Unlike employersí liability or public liability insurance policies, motor policies legally have to provide unlimited cover for personal injury claims.
Unlike employersí liability or public liability insurance policies, motor policies legally have to provide unlimited cover for personal injury claims.
Motor insurers, and any insurers offering a policy for RTA risks, have to be members of the Motor Insurersí Bureau (MIB) and pay into the bureau so that the MIB can meet claims caused by uninsured and untraced motorists. This is a cost that employersí liability and public liability insurers donít have. Not all insurers currently covering off-road and special vehicle risks are members of the MIB.
Therefore the cost of insurance for businesses using these kinds of vehicles may well rise in the future.
None of the changes will take effect until the RTA is amended in Parliament, but the changes are likely to come quickly as soon as it comes into effect.
The consultation started earlier this year and following this it is possible that the Act could be altered as early as the first half of 2016.