The legal framework for motor vehicle insurance is contained in section 145(1) of the Road Traffic Act 1988 (RTA 1988). RTA 1988 requires all drivers to carry insurance against potential liability to passengers and other road users in respect of death, personal injury or property damage. To comply with this requirement, policies must be issued by an authorised insurer, ie an insurer who is a member of the Motor Insurance Bureau (MIB).
For information about motor insurance, see Practice Note: Motor insurance.
Failure to hold motor vehicle insurance is a criminal offence and the victim of an accident will also have a civil action in damages against the owner of the vehicle who caused or permitted its use. In practice, this allows the MIB, having indemnified the driver, to bring a subrogated claim against the driver or the person who caused or permitted the uninsured driving.
For more information, see Practice Note: Driving without insurance. For guidance on bringing a subrogated claim, see Practice Note: Subrogation in insurance and reinsurance.
The compulsory insurance scheme
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