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Is Your Car or Motorcycle Properly Insured for Your Use?

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Is your car insured properly? Our Partner Michael Pace gives his expert analysis below. 

These days, most UK police forces use Automatic Number Plate Recognition (ANPR) to find out whether your vehicle is taxed, insured and MOT'd. They also use this system to alert them to whether the owner (usually the driver) holds a driving licence, is disqualified from driving or is wanted by the police.

A lack of proper insurance in accordance with different types of car use has caught many drivers out and continues to do so. How can it be avoided?

There are different levels of insurance, starting with third party only, through to fully comprehensive. The only way to understand exactly what you’re insured to do is to read the certificate and policy. Yes, that means reading the small print!

It’s a requirement of the Road Traffic Act 1988 that every motor vehicle is covered by a policy of insurance against a claim from a third party, called 'third party only'. This is the lowest level of cover you can buy.

In the event of an accident that is your fault, you will be covered for the other person's losses but not your own. This type of policy will not normally be acceptable to a finance company from whom you have borrowed money to buy the vehicle.

Third party, fire and theft is one rung up the insurance ladder. It is what it says it is - cover for damage caused to another person or their property and cover to the value of the vehicle in the event it is stolen or catches fire.

Most people take out fully comprehensive insurance. This usually comes with a lot of terms and conditions as to the use of the vehicle and who can drive it. It’s common for insurers to insert clauses that can allow them to refuse to pay out in the event of a claim.

People are often caught out by not reading these clauses. For instance, the term, 'social, domestic and pleasure', does not cover a driver for the journey to and from work. To be sure you’re covered, you should make sure that the phrase 'for commuting to and from the policyholder’s usual place of work' is stated on the certificate.

Once at work you will not be covered to use the vehicle to drive between offices or to drive to a business-related meeting. Even a trip to the Post Office to take the mail is not allowed. That would be classed as 'business use' and the certificate needs to clearly state 'for use in the policyholder's business'.

It’s also important to think about who can drive the insured vehicle. Many people assume that if they have fully comprehensive insurance, they can let anyone drive their vehicle. This cannot be further from the truth unless the certificate clearly states that the vehicle is covered 'for any driver with the permission of the policyholder'. Often this comes with a further clause of 'any driver must be 25 years of age or more'.

Neither can it be assumed that a 'fully comp' policy will allow you to drive any other vehicle unless it clearly states on the certificate that you are covered to do so. In this case, there is usually a further clause to say that the vehicle you are going to drive must already be covered by a policy of insurance (in the owner’s name).

To conclude, everything is in writing on the certificate and sometimes hidden away in the policy booklet. Your responsibility after taking out insurance is to read the certificate to make sure you have the cover you need. Check the policy to find any exclusions and always read the small print!

To be caught driving without insurance can lead to your vehicle being taken away from you and impounded as well as a minimum of six penalty points and a hefty fine. If you are accused by the police of driving without insurance, and you do have a policy of insurance in place, it is usually best to take advice from a solicitor with a good knowledge of road traffic law.

Andrew & Co has a dedicated road traffic law department. To contact them for more information, call 01522 512123 (Lincoln office) or 01636 673743 (Newark office).

Michael Pace

Is Your Car or Motorcycle Properly Insured for Your Use?

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