Loss of no claims not my fault

[keithmakingston]

Hi, help needed please. Can anyone give me some advice?

I sold a vehicle which was then involved in an accident some 4 weeks later. I forgot to cancel the insurance and the insurance company say I am still liable under my insurance. I cannot believe how this can be.

The last letter I received is as follows, I have removed sensitive details -
I am aware that the registered keeper of the vehicle, registration ******, is no longer you and a DVLA trace has confirmed this. However, I am not able to close the claim and allow the no claims bonus.

I have contacted the other party’s agents who have confirmed they are attempting to obtain the drivers’ motor insurance details to re-direct this claim. Unfortunately, until they have confirmed with the driver that other insurance was taken out for this vehicle, the claim will remain open.

Although the vehicle was sold, your motor insurance policy was not cancelled and therefore as the insurers of the vehicle at the time of the incident, we still have a liability under the Road Traffic Act to deal with this matter. As the last known insurer we may ultimately have to pay this claim as ‘RTA’ insurer if it cannot be re-directed.

I hope this explains the situation to you and if I can be of any further assistance, please do not hesitate to contact me.

I would have thought that the police would want to charge the person with no insurance. I have no details about the accident only a date.
Any thoughts would be appreciated.

[LemonTwist]

I've never heard of anything like this before. This case seems to contradict everything I've been taught about insurance. At the point when you sold the car, you no longer had "insurable interest" in it as it no longer belongs to you. Therefore, any policy on it should be treated as void. It is the new owner's responsibility to insure the car, from the point they started driving it.

I don't believe under law you or your insurer could be held liable, but can anyone else please confirm this?

[yidarmy]

Strange one – but can’t see how you or your insurance are liable for this as DVLA records prove. The insurance is taken out under your name and if it’s your name on the policy no one else can use your policy – that’s a criminal offence.

It seems insurance companies as I’ve found out with cars, have no common sense whatsoever.

I would speak to the person you sold the car to. Find out more details of the accident and tell them that they are making you and your insurance company liable.

As far as I’d be concerned, your policy is for YOU and YOUR CAR. It’s not your car now and it wasn’t you who was driving.

I’m sure you’d win in a court of law. I can’t see any logical reason for you to be liable for something which doesn’t concern you.

In fact, how do your insurance company even know about the accident? At a scene of an accident, both parties exchange contact details. So how your insurance company has been brought into the equation I don’t know?

[patdavies]

As the insurance wasn't cancelled when the vehicle was sold, it remained in force.

If the new owner/driver was not insured then the Road Traffic Act places the onus on your insurance company rather then the public purse.

Even though you were not driving; and indeed, the vehicle would have been driven outside the terms of the policy, your insurer remains liable for third party claims unless you had cancelled the policy and returned the certificate.

As a claim has now been made, your NCB is at risk. Don't forget, it's a no claim bonus; not a no blame bonus.

As long as the new owner/driver insured the car, it shouldn't be a problem ans as soon as your insurer has passed the matter over, your NCB will be re-instated. To cover themselves, as the claim is 'pending' until they can pass it over, they will withold the NCB

[keithmakingston]

This is getting interesting. Does this mean then that a stolen vehicle or one that is used without the permission of the owner, the insurer is liable for third party claims?

[Trojan1401]

Yes, that is absolutely correct.
As last known insurer the have an obligation under the RTA to deal with and Third Party claim.
However, when you sold the vehicle, did you not notify your insurer ? The insurer wuld then have removed the vehicle from the MID and you would not be held in anyway liable albeit the insurer themselves could still be liable under RTA.
Unfortunately this is why you must notify your insurer when you sell / change vehicles. It is a material fact.
Mind you, if you can prove the sale of the vehicle and supply details I would expect an insurer to give you, the policyholder the benefit of the doubt and deal soley as RTA insurers.
This is a technicality which a non motor insurance person would not be expected to know.
I would also question whether your insurers have looked into this fully. Provided that the new owner has insurerd this vehicle the registration will appear on the MID along with details of the current insurer. Worth giving them another call.
Any problems I'm sure one of us can help.

[CrispDust]

Besides if you have legal protection insurance or whatever they call it you should be able to use this to claims ALL the costs you incur ie loss of no claims and subsequent premiums, from the new owner.
I'd get on this aspect straight away as it may save a lot of hassle if someone else is legally pressuring the other concerned parties.

[indebtstudent]

Once again my opinion of insurance takes a nose dive...

[Bernie_the_Bolt]

Originally Posted by indebtstudent

Once again my opinion of insurance takes a nose dive...

Sorry, this is not the fault of insurers it's the fault of politicians.

[Weird Al Yankovic]

I thought it was up to the policy holder whether or not to make an insurance claim in any case.

This situation seems to be that the insurance company are telling you that you have to make a claim, regardless of the situation.

[cazzaswfc]

Originally Posted by Weird Al Yankovic

I thought it was up to the policy holder whether or not to make an insurance claim in any case.

This situation seems to be that the insurance company are telling you that you have to make a claim, regardless of the situation.

not in this case, as above people have pointed out, under the RTA (article 51? if I remember correctly) the last known insurance company is liable for any tp claim if a uninsured car is the cause ( this is regardless of the cert being returned or not!).

there are then a few things that most co's will look at.
Claiming the costs back, say I cancel my policy yet still drive around and cause a crash, the insurance company could ( and do) bill me for the full costs of the claim, this could be the same as if you have sold the car, if they can get hold ( and prove) that the new owner was the cause again they could bill them. ( please be aware that the majority of people who do this will prob never be found - moved address etc)

Unfortunatly this is a long process and any claim is yours until proven not your fault, this is one of the reasons why legal cover is SO important to have.