Motor insurance
Motor insurance

The following PI & Clinical Negligence practice note provides comprehensive and up to date legal information covering:

  • Motor insurance
  • Types of insurer and MIB liability
  • Liability under the insurance policy
  • Liability as Road Traffic Act 1988 insurer
  • Liability as an Article 75 insurer
  • Stolen vehicles
  • Direct rights of action
  • Green Card scheme
  • Accidents abroad

Brexit: The UK's departure from the EU on exit day, ie 31 January 2020, has implications for practitioners considering road traffic accidents. For guidance, see Practice Note: Brexit—considerations for personal injury claims.

In this Practice Note, the Road Traffic Act 1988 is referred to as RTA 1988.

Types of insurer and MIB liability

In the majority of claims a motor insurer will provide a full indemnity to their insured under a valid policy of insurance. This means that the insurer will accept a contractual liability to pay all damages that fall on the defendant driver.

However, if there is a breach of the policy (either before or after the event) by the insured, the insurer is able to contractually avoid liability to their insured. In that instance the claim is likely to be dealt with by:

  1. the Road Traffic Act insurer: a motor insurer has certain obligations to satisfy judgments obtained by an innocent third party even if there have been breaches of the insurance policy by the insured, failing which

  2. the Article 75 insurer: by an agreement between the Motor Insurers’ Bureau (MIB) and insurance companies, motor insurers will accept liability in certain cases where they would not be liable as a Road Traffic Act insurer—in such cases the liability is limited to the terms of the MIB Uninsured Drivers’ Agreement, failing which

  3. the MIB: if the

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