Revoking third party cover

Burnsy2023

Burnsy2023

Burnsy2023

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Help me settle a debate.

Consider the following scenario: you have SD&P cover on your car, but for a journey you use it for business (say you drive to a client's site) and you have an accident. Could the insurer rescind third party cover because of this and thus make you liable to prosecution for no insurance? I have a feeling this isn't quite the case from a court judgement, but it's just a hunch. Anyone care to help?
 
That would be a very hard scenario to produce wouldnt it, no one in their right mind is going to admit to being on business are they.

But anyway if it happened i would say your insurance company wouldnt leave you high and dry for prosecution, they just wouldnt foot any of your bills.

Only a guess that of course.
 
To the best of my knowledge taking into account the fact I am not a lawyer, no, your insurer cannot do this. They are legally obliged under the terms of the Road Traffic Act to offer third party cover irrespective of any dispute between them and the policyholder.

This is even the case if you are found to be unfit to drive through the use of drink or drugs, let alone something as trivial as whether you've paid the extra tenner a year to pop to a meeting once a blue moon.
 
My "hunch" is that the insurer pays the 3rd party, doesn't give you anything, then if it's likely to be profitable, sues you for the 3rd party costs.
 
Dangerous Dave said:
They wouldn't revoke the cover and pay out for the 3rd party claim however they would use a clause in the T&Cs to claim back the costs from the policy holder.
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I suspect it is unlikely that the ombudsman would find in their favour given they would be unlikely to show that they'd not have accepted the risk had they known that the policyholder might make a business trip - most insurers offer such cover for a trivial extra amount - nor would they be able to prove the policyholder acted maliciously.

Just think how many people there are out there who never leave the office yet perhaps once a year might need to pop off site for something, I doubt these people have 'Business use', I doubt they even think about it. They'd truthfully have answered 'No' to 'Will use it for business' at the time and then had it not even cross their mind 11 months later when the boss says 'You need to go for a meeting at XYZ tommorrow'.
 
[TW]Fox;16851900 said:
I suspect it is unlikely that the ombudsman would find in their favour given they would be unlikely to show that they'd not have accepted the risk had they known that the policyholder might make a business trip - most insurers offer such cover for a trivial extra amount - nor would they be able to prove the policyholder acted maliciously.

Just think how many people there are out there who never leave the office yet perhaps once a year might need to pop off site for something, I doubt these people have 'Business use', I doubt they even think about it. They'd truthfully have answered 'No' to 'Will use it for business' at the time and then had it not even cross their mind 11 months later when the boss says 'You need to go for a meeting at XYZ tommorrow'.
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They may not follow it up but the policy T&Cs will allow them to reclaim the costs if required it doesn't matter how trivial it is not to have business cover they technically have breached the terms of the insurance policy resulting in no cover just like people who don't declare remaps/car modifications.
 
[TW]Fox;16851865 said:
To the best of my knowledge taking into account the fact I am not a lawyer, no, your insurer cannot do this. They are legally obliged under the terms of the Road Traffic Act to offer third party cover irrespective of any dispute between them and the policyholder.

This is even the case if you are found to be unfit to drive through the use of drink or drugs, let alone something as trivial as whether you've paid the extra tenner a year to pop to a meeting once a blue moon.
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Not strictly true, an insurer can cancel the policy the back to inception and as such render you without insurance for a period where any accident could/can have taken place. If the insurers have already paid out before the decision to cancel back to inception is made they can/will recover the costs back from policy holder.

But to do that it would normally be for something far more serious than using a vehicle for business use when you don't have the cover. In that sort of scenario it's likely the would just repudiate the policy holder's claim.

Edit:- Beaten by miles, should not leave a thread ages before posting without refreshing it first :o
 
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Burnsy2023 said:
You guys are repeating what I thought, I don't suppose we have any sources?
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Not really a source, so take it for what its worth.. but I work for an insurance company and as such I'm more than familiar with claims that have been repudiated/ or under investigation with validation departments.
 
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Happy said:
Not strictly true, an insurer can cancel the policy the back to inception and as such render you without insurance for a period where any accident could/can have taken place.
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No, they cannot do this - the Road Traffic Act makes them legally liable for third party risks. Yes, they can try and recover the cost of meeting these claims from you, yes, they can refuse to fix your car, but at no point can they retrospectively remove cover and leave you open to a driving without insurance charge*

The Road Traffic Act obligates an insurer, by law, to cover against third party risks.

*In my opinion, I am not a lawyer.
 
Burnsy2023 said:
You guys are repeating what I thought, I don't suppose we have any sources?
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No we are all really guessing how an insurance company would deal with this in most cases it is not going to be worth the insurance companies time/expense compared to just settling the claim.

Can you give more details on the outcome of the court case you are referring to ?
 
Dangerous Dave said:
Can you give more details on the outcome of the court case you are referring to ?
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My memory is patchy, but I remember this coming up before on here and someone linking to a judgement which I read with interest. I can't find any of it though, but I thought it might have jogged someone's memory.
 
[TW]Fox;16852250 said:
No, they cannot do this - the Road Traffic Act makes them legally liable for third party risks. Yes, they can try and recover the cost of meeting these claims from you, yes, they can refuse to fix your car, but at no point can they retrospectively remove cover and leave you open to a driving without insurance charge*

The Road Traffic Act obligates an insurer, by law, to cover against third party risks.

*In my opinion, I am not a lawyer.
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I said rendering *you* without insurance, but I'm sure I seen claims where the above has happened - I will check this at work tomorrow :)
 
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Happy said:
I will check this at work tomorrow :)
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Unless you work at a solicitors I'm not sure what help it would be, as I would not expect anyone working in an insurance companies call centre or similar would have any idea about the laws pertaining to insurance :)
 
[TW]Fox;16852308 said:
Unless you work at a solicitors I'm not sure what help it would be, as I would not expect anyone working in an insurance companies call centre or similar would have any idea about the laws pertaining to insurance :)
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I think you would be surprised, I'm not stating I know, but their are several departments within any insurance company that would ;)
 
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