Monday, 13 July 2015
The Uninsured Drivers Agreement 2015
After a delay of over two years the Department for Transport finally announced last week that it had agreed the terms of a new Uninsured Drivers Agreement with the Motor Insurers Bureau. The 2015 version, which comes into force on 1 August and can be downloaded from the MIB Website.
The new agreement reflects the DfT’s original proposals that were set out in its consultation paper from 28 February 2013. One notable beneficial innovation is the excision of two unlawful passenger exclusion clauses that it was warned about in the consultation responses, defects later confirmed by the Court of Appeal ruling in Delaney v Secretary of State for Transport 2015 EWCA Civ 172.
Other welcome changes include the removal of the MIB’s ability to strike out valid claims for trivial procedural infractions and the simplification of the claims process, which are both positive steps and they make the agreement that much shorter. However, these unjust provisions should never have been permitted in the first place and nothing has been done to revoke their application in the thousands of claims left to run under the current discredited regime that remains in force for all accidents predating 1 August 2015.
Unfortunately the Uninsured Drivers Agreement 2015 contains a number of serious flaws. The minister has failed to act on the advice received from a number of respondents to his own consultation that he must ensure that the new agreement complies with the minimum standards of compensatory protection required under European law; it doesn’t. The new agreement contains a number of exclusions and restrictions to the MIB’s liability to compensate that are not permitted under European law. There are also concerns that by removing the right to appeal MIB decisions to the Secretary of State for Transport and substituting this with a paper appeal process to an arbitrator whose decision will be final, the agreement effectively prevents the arbitrator from considering the European law context.
The present much discredited Uninsured Drivers Agreement was introduced in 1999 without proper consultation and that agreement contained numerous clauses that conflicted with the minimum standards of protection required under the European directives on motor insurance. See my earlier blogs. That agreement needed immediate rectification and a number of its provisions were later successfully challenge and either amended by the courts applying a European law consistent interpretation or they were the subject of a award in damages against the Secretary of State for Transport under Francovich principles.
Now it seems that history has repeated itself. The minister has approved an agreement in which the Motor Insurers’ Bureau has given itself powers to exclude claims and to restrict its liability in circumstances that clearly contravene European law.
I am concerned that the minister should has chosen to ignore the advice he received from myself and others by approving the new Uninsured Drivers Agreement 2015 in this form and then presenting it, as in 1999, as a fait accompli. As his department have declined to answer or even to acknowledge my earlier correspondence seeking clarification, I have decided to express my dismay in an open letter, a copy of which is posted separately.
I understand from an insurance journal that a DfT spokesman who has commented on my letter, asserts that the new agreement is fully compliant with European law and that the minister has no plans to amend it.
It is therefore down to the legal profession to challenge the infractions in the present Uninsured Drivers Agreement, the new 2015 Agreement as well as the numerous breaches of European law in Part VI of the Road Traffic Act 1988, the EC Rights Against Insurers Regulations 2002 and the Untraced Drivers Agreement 2003.
I will be presenting a webinar for APIL on the Uninsured Drivers Agreement 2015 on Tuesday 15 September. Please apply to APIL direct if you wish to subscribe. I will also provide detailed in-house training and workshops on MIB claims, motor insurers liability and RTA liability generally. Please contact me at firstname.lastname@example.org or on 07968 427134.