Motor Insurersí Bureau

by Daniel Menell

Many people who have suffered personal injury as a result of an accident involving someone who was not insured, or involving a "hit and run" believe that they are not entitled to claim compensation for that personal injury.

The M.I.B, as it is commonly known, was set up in the 1940ís in order to provide compensation to victims of either uninsured or untraced motorists. Every insurer is obliged to contribute to the M.I.Bís funding. That in turn means that the scheme is largely funded by you and me, and every other person who pays for a motor insurance policy. Between £15 and £30 of your annual premium ends up with the M.I.B, and that figure continues to increase.

The M.I.B will only compensate where there would have been a legal requirement to insure the offending vehicle. Thus an accident caused by a bicycle will not be considered under the scheme. More worryingly, as there is no legal obligation to insure a vehicle when used away from the highway or public place (i.e. on private land ), an otherwise valid claim may fail altogether if you were unfortunate enough to have been hit by a vehicle in the wrong place.

This creates a ludicrous anomaly which quite understandably, might cause an injured person to hang their head in disbelief at how unjust the system can be. As an example, you would be compensated if you were run over by an uninsured driver as they carelessly reversed into a parking space at the supermarket (being a public place). However, should you be run over by the same car and driver on a private road to which the public do not have general access, your claim will likely fail.

There are two M.I.B agreements dealing with personal injury compensation:-

Untraced Driversí Agreement

This agreement is intended to compensate victims of "hit and run" motorists. It is a prerequisite that an accident resulting in personal injury caused by an untraced driver be reported to the police within 14 days wherever possible. Ensure that when reported to the police, you obtain proof of having done so, by way of written acknowledgment or a crime or incident reference number. It is also a condition that an applicant must have co-operated fully with any police investigation. There are restrictions and conditions on claiming property damage and other financial losses under this agreement, and there is a £300 excess for financial losses, but the most important thing to note is that the M.I.B, under this agreement, will only pay a minimal contribution to legal fees incurred in pursuing the claim. That means that it would simply not be practical for solicitors to act for those claiming compensation under this agreement. A common practice therefore, is for solicitors to agree to limit their charges to a client to a maximum percentage of any compensation recovered.

Alternatively, you can of course deal with the M.I.B. yourself, although with a higher value claim that could prove a false economy. The procedure involves no Court documents (you can not of course sue someone whose identity you do not know), although you should be prepared to do a lot of chasing up as it can be a tediously slow process where months on end can pass with seemingly no progress at all.

Uninsured Driversí Agreement

Under the terms of the M.I.B. Uninsured Driversí Agreement, the M.I.B, subject to a raft of technical obligations on your solicitors, is obliged to satisfy an unpaid judgment against an uninsured motorist. Whilst the scheme is not perfect, it does offer a much needed lifeline to most victims of such accidents. In 2006, the M.I.B. paid out more than £350 million. That figure is increasing, due largely to the ever increasing numbers of uninsured motorists, many of whom operate on a calculated risk basis that the combined cost of buying a cheap car and a fine if caught are often considerably less than the cost of insuring their vehicle. You might ask why a fraction of the £350 million per annum could not be invested to set in place a system whereby the number of uninsured drivers is drastically reduced. And that would indeed be a good question.

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